Toyota to make more Camrys in Georgetown after ending deal with Indiana Subaru plant

Bloomberg NewsMay 9, 2014 

TOKYO — Toyota will crank up production of the Camry, the top-selling U.S. car for the past dozen years, at its Georgetown plant after it stops farming out some manufacturing to the Subaru of Indiana Automotive plant.

Toyota will move Camry production of about 100,000 sedans to Kentucky in the second half of 2016, it said Friday. The move will free up more capacity at the Lafayette, Ind., plant, owned by Tokyo-based Fuji Heavy Industries, whose Subaru brand is on pace for a sixth consecutive annual sales record.

Mike Goss, vice president of external affairs for Toyota Motor Engineering & Manufacturing North America in Erlanger, said the Georgetown plant already makes roughly 350,000 Camrys annually and will be able to add capacity by adjusting production.

"We still have a lot to study, but at this time we don't anticipate adding any jobs," Goss said. "There are ways to adjust production, and we'll be working on how to do that in the coming two years."

Making up for the lost Subaru capacity keeps Toyota in position to defend the model's lead over Honda's Accord, Nissan's Altima and Ford's Fusion.

To fend off mounting competition, the world's largest automaker is making styling changes midway through Camry's typical five-year design cycle by introducing a restyled version with more contoured body panels and sportier handling that it unveiled last month.

"Every time I speak with Toyota people regarding Camry sales or Camry incentives, they always say 'Camry is different; Camry is special,'" Kei Nihonyanagi, a Tokyo-based equity analyst for Bank of America's Merrill Lynch, said by telephone. "Securing the No. 1 position in the U.S. is very important to Toyota."

Camry's U.S. deliveries have slipped 0.2 percent through the first four months of this year after rising 0.9 percent in 2013, when the car lost market share in the mid-size sedan segment to Accord, Altima and Fusion.

Fuji Heavy, which counts Toyota as its largest shareholder, plans to enhance its product lineup with a focus on SUVs. CEO Yasuyuki Yoshinaga said Friday the company plans to introduce a new SUV that will be exclusive to the North American market and might build the model at its plant in Indiana, after Camry production there ceases.

Even after Fuji Heavy's production of Camry for Toyota ends, the two companies plan to continue work on clean energy technologies, including plug-in hybrids and electric vehicles, during the mid-term, Yoshinaga told reporters Friday. Fuji Heavy also produced the Subaru BRZ and Toyota 86 sports cars that the two jointly developed in Japan.

Toyota announced in late April that it would shut down its engineering and manufacturing headquarters in Erlanger, affecting about 1,550 workers, in a nationwide consolidation of its corporate operations to offices in Plano, Texas. As part of that move, the automaker said about 300 production engineering positions in Erlanger would move to Georgetown. In addition, 750 jobs are being added in Georgetown to support production of the Lexus ES 350.

Herald-Leader staff contributed to this report.

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