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Automakers unable to reach a deal on future products
By Jeff Green
and Bill Koenig
Bloomberg News
Published on Tuesday, Jun 30, 2009
General Motors said Monday it failed to reach an agreement with Toyota on future products at a Fremont, Calif., joint venture and will shed the operation in bankruptcy.
The New United Motor Manufacturing Inc. unit that builds the Pontiac Vibe models alongside Toyota Matrix station wagons will stop making the Detroit-based automaker's vehicles in August.
GM started the venture, known as Nummi, in 1984 as a way to study Toyota practices while the Japanese automaker tested its production system in the United States.
''After extensive analysis, GM and Toyota could not reach an agreement on a future product plan that made sense for all parties,'' GM North America President Troy Clarke said.
Ending the relationship follows GM's push to reduce costs since filing for court protection June 1. The automaker plans to sell most of its money-losing Opel unit in Germany, shed more than 1,300 dealers, close or idle 15 U.S. factories, and slash
thousands of salaried and union jobs.
''Back in 1984, Nummi had a defined life and a usefulness for both Toyota and GM,'' said Michael Robinet, an industry analyst at CSM Worldwide in Northville, Mich. ''We are likely well past that now. Toyota now has to question the entire viability of the Fremont operations.''
While GM owns half the plant, Toyota models have accounted for 75 percent of output this year, according to trade publication Automotive News. Toyota also builds Corolla sedans and Tacoma pickups at the factory. GM is dropping Pontiac as part of its plan to shed four U.S. brands.
Toyota ''is sorry that General Motors has chosen to withdraw from the Nummi joint venture, ending a long, successful partnership spanning 25 years,'' according to a statement from the Japanese company. ''Our hope was for the 50/50 joint venture to continue.''
A GM-badged car based on the Prius was among the options for new products after GM said it would end assembly of the Pontiac Vibe at the plant earlier than planned, people familiar with Toyota's thinking said this week.
The factory can make 420,000 cars and trucks a year and employs about 5,400.
General Motors said Monday it failed to reach an agreement with Toyota on future products at a Fremont, Calif., joint venture and will shed the operation in bankruptcy.
Get the full article here.
Comments
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Posted 03:33 AM, 06/30/2009
We are very sorry to hear this as we have been buying these GM products for 25 years. We like the Toyota product and were able to buy a US, UAW made GM badge product since the 1984 Chev. Nova, 1990 GEO Prizn to 1998 Chev. Prizm through 2002 and then the 2003 Pontiac Vibe. My entire family have been driving these with little or no problems. I guess we will now have to go straight to the Toyota product. Too bad GM gave it up. No one ever said they made good decisions lately.
Tallmadge, OH
Posted 05:53 AM, 06/30/2009
Toyota has great quality and design cars. They will be successful without GM there.
Antioch, Fl
Posted 07:05 AM, 06/30/2009
I'm waiting for someone to explain how this is the UAW's fault.
