Final Inspection

Toyota Texas Move: Do as I Say, Not as I Do

The industry’s self-professed greenest automaker is said to be uprooting its U.S. sales-and-marketing operations to the country’s least-green state.

The news, first reported by Bloomberg, that Toyota will be moving many of its Southern California-based sales and marketing positions to Plano, TX, is shocking for a number of reasons.

The most obvious to me is this is an automaker that constantly preaches its commitment to the environment, taking a large chunk of jobs from what is one of the most eco-friendly states in the union to the U.S.’s equivalent of China.

Last year, Texas was given the dubious distinction of being the “least green” state in the U.S. due to having the most annual carbon-dioxide emissions by metric ton, not surprisingly resulting in the worst air quality in the U.S.

Texas also scored poorly on mass transit (there simply isn’t enough of it for the state’s population), recycling and ravenous gasoline consumption.

The New Republic put it succinctly in 2011, asking if Texas Gov. Rick Perry’s record on the environment was just “bad, or awful?”

Perry is a well-known climate-change denier and has fought against stricter government regulation on the environment for decades. In 2010, he famously sued the EPA after the agency decreed CO2 a pollutant.

Texas’ laissez-faire attitude on the environment (and safety, but that’s a blog for a different day) was typified last year when a fertilizer plant exploded in the town of West, TX.

At the time of the April 17 explosion, which killed 15 people and injured at least 160, the plant had not been inspected by the state for seven years.

“Records show the Texas Commission on Environmental Quality investigated West Fertilizer on June 20, 2006, after receiving a complaint of a strong ammonia smell,” the Houston Chronicle reported last year. “West Fertilizer Co. was cited by state regulators in 2006 for failing to obtain or qualify for a (state air-pollution) permit.”

Toyota’s reputation isn’t totally clean on the environment. After all it sells a fullsize pickup, the Tundra, and several large SUVs, the Toyota Sequoia and Land Cruiser and the Lexus LX and GX.

But it has sold more hybrids, mostly in the form of its Prius model, than any other automaker, and has a long-standing mandate to put a hybrid version of nearly every model in its lineup on the road in the 2020s.

It also continues to be a leader on hydrogen fuel-cell vehicles, with a salable HFCV planned for next year.

Some analysts and commenters have suggested the cost of California’s environmental regulations, which come in the form of increased taxes on businesses operating in the state, is the key factor behind Toyota’s decision to mosey on to Texas.

The regulations have helped clear the notoriously smoggy air in the Golden State, resulting in an optimal environment to work and have fun.

If the No.1 Japanese automaker really did pull the plug on its Torrance operations for tax reasons, we’ll know what “green” status really counts in Toyota City.

cschweinsberg@wardsauto.com

Discuss this Blog Entry 11

on Apr 29, 2014

As a Texas resident, I protest. I was born in California and lived there for many years. You can vote till hell freezes over about the eco greeness of that state. All it has ever accomplished is to drive every auto manufacturing factory and almost all of the auto suppliers from the state losing thousands of jobs in the process. I can remember when the smog first appeared and every law that was supposed to suppress it until I wised up and moved to Texas. I visit California every year because of my son and grandchildren. I don't see any smog improvement whatsoever. It's as thick and brown as it ever was even after spending unknown millions to suppress it. This state expects every other state or country to provide it with the necessities of life without having to permit any kind of environmental deterioration from manufacturing processes. It does not provide sufficient electrical power and expects places like Mexico and other states to provide at rock bottom cost. It taxes everything that moves, has a gigantic income and budget that it can't balance, and is willing to chase every business from the state just to prove how eco friendly it is.
Bah humbug!!

on Apr 29, 2014

You make a good point that CA is reliant on other states for much of its energy. And the smog certainly looks less oppressive to me when I travel there than what I've seen in pictures. Your last point about CA "chasing every business" from the state to prove eco-friendliness I take issue with. No one is chased. Companies have a choice whether or not to comply with environmental regulations.

on Apr 30, 2014

No, companies do not have the choice as to whether or not to comply with regulations, unless the choice involves risking fines and imprisonment. Regulations are not recommendations. Companies still do have a choice to move to a lesser regulated state. Choice is a good thing. We should not wish for a future of reduced choice.

on Apr 30, 2014

“…And the smog certainly looks less oppressive to me when I travel there than what I've seen in pictures.”

You're not really helping your case with these comments. Yes, I’m sure a few visits to LA and the resultant empirical observations are a far more accurate measure of smog versus photographed (and scientifically measured) evidence. Also, smog is seasonally related. Compare a picture of mid-summer smog versus a visit in the winter, and yes, I’m sure it will appear that all the restrictive regulations and hybrid cars have magically ‘fixed’ the smog problem. Sounds legit.

“No one is chased. Companies have a choice whether or not to comply with environmental regulations.”

But therein lies the rub – if the imposed regulations make it difficult for a company to remain solvent, the company does have a choice as to whether they move to a location that allows them to be more profitable. Companies, and this is shocking I know, are in the business to *make money*. If they can make a higher rate of return moving some offices to TX, then more power to them. And again, we’re talking about a “sales & marketing” arm of Toyota – not their nasty rare-earth mining operations for supposedly ‘clean’ hybrids or even a manufacturing plant, just office jobs, mind you. Toyota isn’t skirting tough regulations in CA with a highly pollutant, nasty facility that they’ll move to TX to run roughshod over the land.

And that brings up another point. It seems to be a widespread belief along the coasts (especially CA) that their standard of living is completely achievable without an ounce of ‘pollution’. Hybrid cars require highly damaging rare-earth mining (but hey, that’s in China, so who cares, right?) and the electricity used by PHEVs & EVs is most likely generated from natural gas (methane) or coal. Let’s not even talk about disposing of those used up batteries, either. Solar, wind and hydro-electricity, while quaint, are technologically limited to be minor contributors to our energy balance (that’s not an argument against using them in an augmenting fashion, as they work well in that capacity). I believe all individuals and corporations should behave in a manner befitting of being a good steward of the land - but spoiler alert - some pollution will occur. Some regulations are good, and others are just a ridiculous squeeze that make ignorant people feel good about themselves.

Of course, I’ll get lumped in with Perry as a ‘climate-change denier’ since I have an education in geology and understand that CO2 is not the most significant greenhouse gas, and I also understand that CO2 levels have varied greatly in Earth’s history independent of both humans and the advent of burning fossil fuels. Even if CO2 was the prime culprit, it’s also a bit inconvenient many natural processes can emit untold levels as well. I also understand that mankind has suffered greatly during extended cold periods of time (kind of hurts agriculture) and that current non-biased data indicates average temperatures may be swinging back down the other way. That’s why the alarmists had to change the phrase from ‘global warming’ to ‘climate change’ – an obvious move considering the climate is always changing. The onus of proof is not on those making ridiculous anthropogenic claims, but instead on those who choose to be more scientifically rational (guilty until proven innocent). If we can blame certain unrelated factors, then tax them to oblivion, and then create cottage industries making normally non-profitable items propped up by government subsidies and reap the rewards (profit).

It’s still capitalism on both sides of the coin, but on the alarmists’ side they can claim to be doing something ‘good’. It just so happens that Toyota won’t be the only company to make such a move, and California’s balance sheet will continue to delve further upside-down as they live their perfect, non-polluting lives with no industry. I’m sure it won’t hurt their feelings to supposedly pillage the environment in that useless, barren wasteland that is ‘flyover country’ to make all the things they need to continue their posh lifestyle, however.

on Apr 29, 2014

What a ridiculous article. Such a slanted, immature piece shouldn’t have made it past the editors – heck, I’m not even a Texan, but this offends my sensibilities. This is puerile provincialism, plain and simple.

The entire thesis of your article is that Toyota should be ashamed of moving out of an idyllic, environmental utopia and relocating to an environmental hellhole. How quaint! The best line sounds like it came from a California tourism guide: “an optimal environment to work and have fun.”

You also bury a key reason for the move: taxes. Texas incentivized this move, obviously. Do you really think Toyota is moving a “sales and marketing” facility to Texas so they can *pollute more*? It’s not as if we’re talking about an automotive manufacturing facility, or heck, a chemical plant or something even more nefarious. And you do also realize that Toyota already has manufacturing facilities in Texas - perhaps they saw fit to move these two operations closer together?

Perhaps you should ask all of the migrant workers living in poverty in California how ‘optimal’ their situation is. But of course, I should know better, nothing bad ever occurs in California, but a fertilizer plant once exploded in Texas – gosh what an awful place! Of course it wasn’t simple negligence in West, TX – it had to be a rogue plant actively plotting to destroy the environment with the evil Republican state government’s approval. Not to mention all of the housing activity in areas known to experience devastating geologic phenomena such as earthquakes and mudslides. Or what about the extensive agriculture carried out in an arid portion of California that requires reckless depletion of freshwater aquifers? Are these environmentally responsible practices?

I mean, have you ever been to Texas? Do you know it’s the second largest state in the union (@268k square miles)? Do you realize it’s the second most populated state as well (26.5 million)? Aside from the three largest cities (Houston, San Antonio & Dallas) do you realize how spread out the population is (this kind of factors into your shot at mass transit)?

Furthermore, you cite Texas’ “ravenous gasoline consumption” but fail to mention the same for California. If you’re curious, you should check the US Energy Information Administration’s State Energy Data System to check gasoline consumption by state. Guess which state was highest in 2012? That’s right, the pollution-free Garden of Eden that is California, at 343 million barrels used. Texas, predictably, given the state’s population and sheer geographic area, came in second at 294 million barrels.

(http://www.eia.gov/state/seds/sep_fuel/html/pdf/fuel_mg.pdf)

At first I was convinced this was written from the perspective of a head-in-the-sand Californian, but then in the comments section, Mrs. Schweinsberg, you comment about the “less oppressive” smog in LA when you “travel there.” So what idyllic corner of the nation do you hail from? You do realize that California still has the highest smog levels in the country, right? And it still persists as a significant health hazard: http://laist.com/2011/09/21/new_study_says_las_smog_pollution.php

Nothing like shaming Toyota with claiming that they must hate the environment, and bashing a far more fiscally sound state in the process. You’ve bypassed a simple explanation in the fact that California has priced itself out of the market for keeping businesses like Toyota, so they’ve sought a more optimal location. Maybe you should stick to writing about cars and leave the poorly conceived political garbage in the waste bin where it belongs.

on Apr 30, 2014

Come on WardsAuto, you need to do better than this. Somehow this mindless dribble passed through your editorial scrubbers, or your Website has been hacked by nefarious troublemakers.
How is it possible that we have let that one global warming (AKA climate change) denier (we shall not use his name) through the clean sweep. Our systems for reeducation and implanting the faith must have some holes in them. We must reconvened the commission and readjust the regulatory processes!

on Apr 30, 2014

Wow WardsAuto. That is a pathetically unobjective, slanted article. I am from neither state and it was hard to finish the article as it came across only as anti-Texas.
Christie, you seem shocked that Toyota is not actually the "green" company that their effective marketing would have you believe they are. Joke is on you! Toyota is no different than any other large automaker. They make cars and trucks in whatever segment they can make money in. They are in business to make money and there is nothing wrong with that.

on Apr 30, 2014

For those complaining that this is slanted, yes, it is. You're in the "blog" section of WardsAuto, not the news section. Taking a side on an issue is the point of a blog.

on May 2, 2014

Point taken Christie. It is the Blog section. I will restate the main point of my post:
You seem shocked that Toyota is not actually the "green" company that their effective marketing would have you believe they are. Toyota has been better at marketing than any other automaker for the last twenty years. Their message has been consistent and on point - Toyotas are reliable and economical. Most recently "economical" has morphed into "green". To me and many others this has been humorous because they are in all of the segments as other auto makers. Some of their products are arguably better and some are not. But their marketing has been effective and much of the buying public and motoring press assume that all Toyota products are superior. Toyota is making a financial decision in moving to Texas, much as Nissan made a financial decision in moving to Tennessee. What shocks me is that they stayed as long as they did.

on May 4, 2014

Perhaps the 'Eco' myth about the Prius is finally being replaced by a clue for one auto writer:

". . . If the No.1 Japanese automaker really did pull the plug on its Torrance operations for tax reasons, we’ll know what “green” status really counts in Toyota City."

We own two Prius not because they are 'Eco green' but they let us keep some of our Greenback dollars at the pump. It is the practical aspects, the low operating cost, that makes the Prius not just a good but a great buy.

In 2001, we ran the experiment and bought a cheaper, Echo instead of a Prius. We sold that Echo in 2009 with under 30,000 miles because of the crappy ride, limited cargo, noisy buzz, and it nearly rolled taking a familiar curve at Prius speeds. A cheaper car is obviously just cheap and a ride not worth driving.

So if it takes going to Texas to fix Toyota advertising, good deal! It is past time to drop grade school play advertising and start selling the Prius as a car, practical transportation. The best "Eco" keeps the green in my wallet.

Bob Wilson, Huntsville, AL

on May 9, 2014

I think this is a GREAT piece on Toyota's hypocrisy. If anything, it doesn't go far enough. I am deeply disappointed in Toyota over this move on a variety of levels.

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