Toyota: Expanding sales of light trucks and hybrids in the U.S.

Investing USD 13 billion in U.S. over 5 years, and reallocating production by platform



RAV4 Prime
U.S. spec RAV4 Prime (PHEV) to be introduced in the U.S. and Japan markets in the summer of 2020 (Source: Toyota; same for all below)

  This report provides an overview of Toyota's U.S. operations. Toyota is implementing its plan to enhance both its product development and production capacity of light trucks and hybrid vehicles in the U.S.

  The company plans to invest USD 13 billion (approximately JPY 1.43 trillion) in the U.S. over the five year period from 2017 to 2021. In addition to starting production at its new Alabama plant in 2021 jointly with Mazda, the company is increasing its investment in its flagship plants in Indiana, Kentucky, and Texas and is enhancing the production of light trucks and hybrid vehicles. By doing so, it will strengthen powertrain production to achieve the 75% regional value content (RCV) required by the United States-Mexico-Canada Agreement (USMCA; new NAFTA).

  For light trucks, the company is developing the new F1 platform, which will be adopted for both full-sized and mid-sized body-on-frame vehicles. Increasing its appeal, the F1 platform offers TRD (Toyota Racing Development) specifications with enhanced off-road performance.

  For hybrid vehicles, from 2017, Toyota has adopted a hybrid system equipped with a 2.5-liter dynamic force engine based on the TNGA concept. The system realizes excellent fuel economy and comfortable acceleration performance. In addition to the conventional fuel-saving benefits, the company will promote an image of hybrid technology as powerful. The company plans to increase the ratio of hybrid vehicles sold in the U.S. from 11.5% in 2019 to 15% in 2020.

  On March 19, 2020, Toyota announced that it would be suspending production at all of its automobile and components plants in the U.S., Canada, and Mexico for a two-week period from March 23 to April 3 to protect the health of its employees and other stakeholders from the ongoing COVID-19 pandemic and to respond to the sharp decline in vehicle demand. On March 26, the company announced that the production suspension period would be extended to April 17.

  Regarding Japan domestic factories, on March 23, it was announced that, in consideration of the overseas market situation and reduced demand, Toyota will suspend production operations for seven lines at five plants for a certain period beginning April 3 (the suspension period varies depending on the plant and line, and the longest suspension period is 9 working days for No. 1 line at the Kyushu Plant).

Related reports:
Toyota: Deepens alliances with Subaru, Mazda and Suzuki to strengthen competitiveness (Jan. 2020)
Tokyo Motor Show 2019: Toyota Exhibits an Array of EVs, FCVs, and Mobility Solutions (Nov. 2019)
Toyota: Electrified vehicle plan pulled ahead 5 years to 5.5 million units by 2025 (Jun. 2019)


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