Demand outpacing supply, but not for long

Toyota is investing $150 million into its Tijuana, Mexico assembly plant in an effort to increase the production capacity of the Tacoma midsize pickup. This comes in response to the high demand Toyota says it’s experienced for the Tacoma.

The investment will push production from roughly 100,000 units to around 160,000 units annually. The investment should be fully realized and production in full swing by late 2017 or early 2018.

Toyota has already added a third shift to the Tijuana plant back in April of 2015, allowing it to run 24 hours a day Monday through Friday, with two shifts on Saturday. Toyota has also added a Saturday shift at its San Antonio assembly plant, which produces the bulk of Tacomas and every Tundra pickup.

“Demand for trucks has grown exponentially,” Toyota Motor North America CEO Jim Lentz said. “By leveraging our manufacturing facilities’ availability and expertise, we can be nimbler and better adjust to market needs in a just-in-time manner.”

Automotive News reports Tacoma sales were up four percent in 2016 through August despite it losing market share to the Chevrolet Colorado, GMC Canyon, and new Honda Ridgeline. The Tacoma dropped from holding 51 percent of the midsize pickup market to 43 percent. Nevertheless, Toyota’s David Crouch, the Vice president of administration and production control at the San Antonio plant, says the automaker hopes to regain market share with the increased production.

Crouch told AM that Toyota dealers don’t have enough pickup inventory on the lot to tempt shoppers to buy. “Obviously, one of the biggest challenges that we have for Tundra and Tacoma is we’re capacity-limited. We could sell a lot more trucks right now.”

Having the supply to meet consumer demand is obviously a huge part of doing business, and for Toyota, it seems business is doing exceptionally well.

Continue reading for more information.

Why It Matters

Toyota has controlled the midsize pickup market for several decades now, with the Tacoma stealing market share from other automakers. Now with the current-generation truck, Toyota is fighting to keep up with demand. It’s a rather good problem to have.

This sizeable investment in the Tacoma’s second assembly plant should help alleviate problems in the production process, affording the plant better efficiency and ultimately greater production.

2016 Toyota Tacoma - First Drive

2016 Toyota Tacoma - First Drive Exterior Test drive
- image 639349

Read our full review on the 2016 Toyota Tacoma here.

Source: Automotive News

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