California Not Ready to Give Up on NUMMI

LOS ANGELES – As New United Motor Mfg. Inc. draws closer to its expected March 31 shutdown, California State Treasurer Bill Lockyer is spearheading an 11th-hour campaign to persuade Toyota Motor Corp. brass to keep the Fremont-based operation open.

Lockyer’s strategy? To convince the auto maker the closure not only will hurt the state’s economy, it will further erode Toyota’s standing in the U.S., now under attack from a controversial widespread recall.

Last month, Lockyer convened an eclectic blue-ribbon commission – composed of business representatives, environmentalists, clergy, politicians, labor activists, an economist, a university professor and even a movie star – to ostensibly study the impending closure and compile a report one campaign spokesman says will be presented to the treasurer’s office later this week and then delivered to Toyota’s headquarters in Japan.

“For months, there were conversations and pleas from a number of sources, trying to get Toyota to keep NUMMI open,” Steve Smith of the California Labor Federation tells Ward’s. “Despite all that, Toyota has gone ahead with its plans. We disagree vehemently.”

NUMMI, the last remaining assembly plant in the state, opened in 1984 as a joint venture with the former General Motors Corp.

During its 25-year run, the plant earned ongoing praise for its product quality and site operations, including more than 40 environmental achievement awards from various regional agencies. From 1993 to 2002, it garnered seven North American Plant Quality awards from J.D. Power and Associates.

GM pulled out of the operation last June amid bankruptcy restructuring. Toyota announced the closing two months later.

In Congressional hearings last week, Toyota Motor Sales U.S.A. Inc. President James Lentz pinned the decision to shutter the plant on GM, which he says controlled 30% of NUMMI when it left. Lentz said continuing the operation was no longer “financially viable.”

Pontiac Vibe accounted for 10.6% of NUMMI output in 2009.

Ward’s data shows GM accounted for 10.6% of NUMMI production in 2009, down from 20.7% in 2008.

Analysts predict the closure will impact a much larger cross-section of Californians than the estimated 5,000 plant employees expected to lose their jobs.

Shutting NUMMI “would clearly be a disaster,” writes University of California, Berkley, professor and commission member Harley Shaiken in an opinion piece published by the Los Angeles Times. “Up to 50,000 jobs are at risk, including those at 1,000 suppliers throughout the state, according to the company’s own numbers.”

At a United Auto Workers rally Feb. 12, Lockyer dismisses the idea there’s not enough time to change Toyota’s minds.

“Everyone says, well, gee, it’s awful late,” Lockyer says. “You know, the union tried respectfully, the community leaders tried, the governor tried. We’re not going to stop trying…and if we have to make it a national issue to get their attention, OK.

While it plans to cut a hefty chunk out of an economy that was hit harder than most by the economic downturn, Toyota has continued to reap the profits from what has long been one of its leading markets, notes Lockyer. It also was the auto maker that sold the most cars through last year’s “Cash-for-Clunkers” federal trade-in program.

“One out of every four (Toyota) Priuses sold in the United States of America is sold in the state of California,” Lockyer says.

“We need to start right here and say, if you want to sell those clean little cars…respect workers and communities that rely on these jobs and those revenues that make our cities strong, our counties strong, our state strong, but mostly make our families strong.”

Aside from the economic considerations, Smith says closing NUMMI also will hit an environmental movement that’s come to see the site as a model for responsible production.

California’s leaders have been “driving up the demand” for environmentally friendly technology by trying to bring Toyota's hybrid manufacturing to the state, “making the public more aware of greenhouse gases and reducing their carbon footprints,” Smith says. Now Toyota “is breaking their commitment to the environment, to workers.”

Toyota had planned to launch production of its Prius hybrid at its new plant in Blue Springs, MS, but construction was suspended when the U.S. new-vehicle market tanked along with the global economy.

With the added scrutiny over its recent recalls, “certainly Toyota is on the defensive right now,” Smith says. “But I think it’s really raising awareness that Toyota has made bad decisions…from the top level down.

“The planned closure of NUMMI is one of those bad decisions.”

Union members already have started teaming with consumer and environmental advocates in a series of demonstrations at NUMMI and several California Toyota dealerships, with plans to target 50 dealerships total in the Golden State and 50 more in other parts of the country.

A delegation including Lockyer and members of the special commission are expected to travel to Japan later this month to hand deliver their findings and meet with Toyota officials face-to-face.

Lockyer has told reporters that, at the very least, he wants Toyota to delay shutting the plant for two years, at which point both the auto market and state economy should be more stable.