Toyota Reduces North American Production but Maintains Jobs

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The worst automotive slump in decades is taking its toll on Toyota that announced additional measures for its North American manufacturing plants. These include new production cuts, the freezing and in some cases, the reduction of salaries and a new voluntary exit program. For the time being, Toyota will not layoff any North American workers. "We've taken responsible, step-by-step actions to address this issue in recent months, and we hope the new measures will help us adjust while protecting jobs," said Jim Wiseman, vice president of external affairs for Toyota Motor Engineering & Manufacturing North America (TEMA).

In previous moves, TEMA:

  • scheduled periodic non-production days as needed, but protected jobs by providing training and plant improvement activities;
  • established a hiring freeze;
  • eliminated overtime;
  • suspended capital spending.

But the ongoing downturn necessitates additional steps:

  • some additional non-production days in April, varying from plant to plant;
  • strong possibility of reduced work/pay weeks, known as
    "work sharing," at some plants. Production team members at affected plants would work and be paid 72 hours instead of 80 during the
    two-week pay period;
  • executive and salaried bonuses eliminated;
  • executive pay cuts;
  • production team member bonuses reduced;
  • voluntary exit program for team members who wish to pursue other opportunities;
  • no wage increases for the foreseeable future.