Toyota to build new plant in Mexico, expand JV in China

Toyota has announced it will build a new plant in Mexico and expand its joint venture, Guangzhou Toyota Motor Co (GTMC), in China.

These investments (US$ 1 billion/Rs 6,317 crore in Mexico and US$ 432 million/Rs 2,728 crore) are grounded on its plans to construct production lines that are more competitive, with greatly reduced initial investment, improved efficiency, flexibility, environmental performance and safety. These ‘simple and slim’ production lines can be easily lengthened or shortened depending on demand. Over-head conveyance devices are eliminated, compact equipment is installed on top of the plant floors, and paint-booths are smaller.

The new plant in Mexico and the expansion in China aim to accelerate innovation by implementing these new technologies into real production lines. A new plant will be built in Guanajuato, Mexico, to support improved competitiveness in North America. The plant will produce the Corolla taking into consideration forecasted steady, mid and long-term growth in North America.

The plant, which will manufacture the Corolla, will have an annual production capacity of 200,000 units and will go on stream in 2019.

Building this plant will be one of Toyota's efforts to realign its North American manufacturing operations and begin a new approach to plant building; featuring new work processes, including Toyota New Global Architecture (TNGA) production engineering innovations, and will be a model for global manufacturing.

Also read: Toyota reveals new global platform for future cars 

From the ground up, this plant will be the first designed to fully maximize the merits of TNGA, like significantly reduced equipment investment for model change-over realized by modularisation of major components made possible by unified engineering. As a TNGA model plant, "smart car-making" results and knowledge will be rolled out to other regions and other plants in the future.

Making this announcement, Akio Toyoda, president of Toyota Motor Corporation, said: "This investment represents our long-held principles of continuous improvement and challenging ourselves to always do better. An increase in production does not mean an undisciplined pursuit of more. Toyota's expansion must be driven by providing ever-better-cars and our talented people. These investments will be an important test of Toyota's resolve and a measure of tangible improvement."

Expansion at GTMC
By restructuring its existing lines at GTMC and building an additional facility by the end of 2017, Toyota says it is preparing itself to respond to future demand for stable growth in the Chinese market, the largest in the world and where a number of automakers have been competing. At the same time, GTMC will collaborate with engineering, production and procurement on effective use of the existing supplier network and cost reduction activities at its R&D centre.