Toyota Will Spend $461 Million To Upgrade Its Kentucky Plant

[Sulu]

Toyota Will Spend $461 Million To Upgrade Its Kentucky Plant | Carscoops

The money will go towards facility enhancements, expanded powertrain capabilities, and a direct-hiring program

www.carscoops.com

Toyota’s First U.S. Vehicle Plant Shifts Transformation into High Gear - Toyota USA Newsroom

GEORGETOWN, Ky. (October 29, 2021) – You might think Toyota Kentucky (TMMK) has seen it all during its 35-year history. But today, Toyota announced a series of changes and projects that will boost the Georgetown plant’s transformation to meet shifting customer demand, reduce its carbon footprint...

pressroom.toyota.com

Toyota is transforming its Georgetown, Kentucky plant (Toyota Motor Manufacturing Kentucky, TMMK) "to help create space for future products and to better align with U.S. market demand".

• The Camry, Camry Hybrid and RAV4 Hybrid models will continue to be built there.
• The new 2.4 Turbo engine will be built there.
• The Lexus ES and Lexus ES Hybrid production will shift back to Japan "prior to the next major model change" (production of the current generation will continue at TMMK but the next generation will not be built in North America is how I interpret it).

No other product announcements were made, other than a nebulous statement about "future electrification efforts".

Could it be that Lexus ES sales are forecast to be low (or lower) in the future and it is being removed to allow for production of EVs (bZ4x and its sister models)?

 

[NXracer]

The EV lineup coming to america is a huge question mark. Its an open secret that EVs are going to be getting 7500 for being an EV, 12.5k (correct me on numbers) for union made in america. I was thinking that the BZ would be made in Japan since, usually most pioneering vehicles from Toyota usually are built in Japan, but then this subsidy is going to play a role in final assembly. This could be why ES the is moving.

To further strengthen this idea/compromise toyota is willing to make, is a new ad/media blitz/lobbying effort from Toyota to force their vehicles to qualify if built here:

Toyota Posts New Ad Pushing Back Against 'Union' EV Tax Credit

There has been a lot of controversy surrounding Democrats' decision to favor unionized automakers over those that aren't organized, and Toyota is stepping up.

insideevs.com

Strange times and alot of lobbying lay ahead

 

[Sulu]

The bZ4x will, according to recent reports, be available in mid-2022 and (more than likely) exported from Japan.

The ES will continue to be built at TMMK until the end of this generation, probably another 3 or so years away (to about ~2024). At that time, ES production will stop at TMMK to allow for "future electrification efforts". At that time, there should be other members of the bZ family of EVs. The bZ4x, and perhaps other bZ models could be built in Kentucky (or perhaps Toyota could build the bZ4x for sale as Toyota models and Subaru models).

I just remembered another announcement from a few weeks ago about investments for building EV batteries in the USA.

Toyota Charges into Electrified Future in the U.S. with 10-year, $3.4 billion Investment | Corporate | Global Newsroom | Toyota Motor Corporation Official Global Website

Toyota announced today that it will invest approximately $3.4 billion (380 billion yen) in automotive batteries in the United States through 2030. Specifically, the investment is for developing and localizing automotive battery production, including those for battery electric vehicles, and is...

global.toyota

The two announcements -- battery production and future electrification efforts at TMMK -- should be looked at together. First, Toyota announced that it intends to build EV batteries in the USA, and second, Toyota announces that TMMK will be upgraded to build electrified vehicles, vehicles that will use those new American-made batteries.

 

[NXracer]

Makes sense the battery factory is coming online 2025, TMMK reorganized in 2024, but I don't get why they would be lobbying in opposition about the union made american built ev tax credit then? If its initially coming out of Japan, they wont qualify either way?

They could patiently wait till 2025? Unless there is some 4d chess move I'm not seeing.

 

[Levi]

The bZ4x will, according to recent reports, be available in mid-2022 and (more than likely) exported from Japan.

The ES will continue to be built at TMMK until the end of this generation, probably another 3 or so years away (to about ~2024). At that time, ES production will stop at TMMK to allow for "future electrification efforts". At that time, there should be other members of the bZ family of EVs. The bZ4x, and perhaps other bZ models could be built in Kentucky (or perhaps Toyota could build the bZ4x for sale as Toyota models and Subaru models).

I just remembered another announcement from a few weeks ago about investments for building EV batteries in the USA.

Toyota Charges into Electrified Future in the U.S. with 10-year, $3.4 billion Investment | Corporate | Global Newsroom | Toyota Motor Corporation Official Global Website

Toyota announced today that it will invest approximately $3.4 billion (380 billion yen) in automotive batteries in the United States through 2030. Specifically, the investment is for developing and localizing automotive battery production, including those for battery electric vehicles, and is...

global.toyota

The two announcements -- battery production and future electrification efforts at TMMK -- should be looked at together. First, Toyota announced that it intends to build EV batteries in the USA, and second, Toyota announces that TMMK will be upgraded to build electrified vehicles, vehicles that will use those new American-made batteries.

That sounds like smart planning from TMC, as usually.

 

[Levi]

Makes sense the battery factory is coming online 2025, TMMK reorganized in 2024, but I don't get why they would be lobbying in opposition about the union made american built ev tax credit then? If its initially coming out of Japan, they wont qualify either way?

They could patiently wait till 2025? Unless there is some 4d chess move I'm not seeing.

Even Tesla is lobbying in opposition. Who could think Tesla does not qualify too?

 

[NXracer]

Even Tesla is lobbying in opposition. Who could think Tesla does not qualify too?

Tesla has a dog in this race, at this time Toyota does not (unless their holding their cards close to their heart regarding final assembly).

Sidebar:
Tesla position is ironic and poetic comedy at best. Keeping their engineering prowess aside, Tesla is quite clever in navigating bureaucracy and marketing like the best damn ad agency in this world. I'm surprised they are being giving them work around. Afterall the most american EV is probably Tesla.

 

[Sulu]

All plug-in hybrids and full EVs sold in the USA -- regardless of country of origin -- may be eligible for the federal income tax credit of up to $7500; this is in effect now. Toyota's EVs may be eligible for this tax credit.

This new bill (not yet law) would top up those tax credits by $500 for American-made batteries and then an additional $4500 for EVs built in the USA in unionized factories. This would give the advantage to unionized Big 3 (GM, Ford, "Chrysler" (Stellantis)) plants. This means that EVs built in a non-unionized factory (Tesla, all of Toyota's American factories, all of Honda's factories, VW's factory are non-unionized) and EVs imported into the USA are only eligible for 60% of the tax credits that EVs assembled by GM, Ford or Stellantis in one of their unionized plants is eligible for.

Canada does not like this bill because, despite a highly-integrated auto-assembly system (each vehicle, regardless of where in North America it was assembled, contains a large proportion of components built in the USA, Canada and Mexico). It would also make EVs that otherwise would have been assembled in a unionized Big 3 Canadian plant ineligible for the extra tax credits; the Big 3 could foreseeably pull all of their EV work out of Canada back to the USA.

 

[LateToLexus]

All plug-in hybrids and full EVs sold in the USA -- regardless of country of origin -- may be eligible for the federal income tax credit of up to $7500; this is in effect now. Toyota's EVs may be eligible for this tax credit.

This new bill (not yet law) would top up those tax credits by $500 for American-made batteries and then an additional $4500 for EVs built in the USA in unionized factories. This would give the advantage to unionized Big 3 (GM, Ford, "Chrysler" (Stellantis)) plants. This means that EVs built in a non-unionized factory (Tesla, all of Toyota's American factories, all of Honda's factories, VW's factory are non-unionized) and EVs imported into the USA are only eligible for 60% of the tax credits that EVs assembled by GM, Ford or Stellantis in one of their unionized plants is eligible for.

Canada does not like this bill because, despite a highly-integrated auto-assembly system (each vehicle, regardless of where in North America it was assembled, contains a large proportion of components built in the USA, Canada and Mexico). It would also make EVs that otherwise would have been assembled in a unionized Big 3 Canadian plant ineligible for the extra tax credits; the Big 3 could foreseeably pull all of their EV work out of Canada back to the USA.

so let's say a future 2026 electric Toyota Tundra that is entirely built in the USA would not receive the full tax credits because not built at a "union" facility?

Please tell me I misread that.

 

[NXracer]

All plug-in hybrids and full EVs sold in the USA -- regardless of country of origin -- may be eligible for the federal income tax credit of up to $7500; this is in effect now. Toyota's EVs may be eligible for this tax credit.

This new bill (not yet law) would top up those tax credits by $500 for American-made batteries and then an additional $4500 for EVs built in the USA in unionized factories. This would give the advantage to unionized Big 3 (GM, Ford, "Chrysler" (Stellantis)) plants. This means that EVs built in a non-unionized factory (Tesla, all of Toyota's American factories, all of Honda's factories, VW's factory are non-unionized) and EVs imported into the USA are only eligible for 60% of the tax credits that EVs assembled by GM, Ford or Stellantis in one of their unionized plants is eligible for.

Canada does not like this bill because, despite a highly-integrated auto-assembly system (each vehicle, regardless of where in North America it was assembled, contains a large proportion of components built in the USA, Canada and Mexico). It would also make EVs that otherwise would have been assembled in a unionized Big 3 Canadian plant ineligible for the extra tax credits; the Big 3 could foreseeably pull all of their EV work out of Canada back to the USA.

Interesting that Toyota would start the lobbying and media push 4 years ahead, before a election cycle for the future $5k? Current competitors on the BZ4x would be the Mexican built MachE and Tennessee non unionized built Id4 (give or take).