BLOOMBERG
Published: April 27, 2014 Updated: 4:47 p.m.
Toyota Motor Corp. is moving substantial parts of its U.S. headquarters in Torrance to suburban Dallas as the world’s largest automaker seeks savings from its U.S. sales unit, said people familiar with the matter.
Employees will be informed of the plan tomorrow, said the people, who asked not to be identified disclosing private conversations. Steve Curtis, a Toyota spokesman, didn’t immediately return a call on the matter.
The surprise move is a blow to the Golden State, the biggest U.S. auto market and proponent of the strictest clean- air rules. Toyota’s Prius hybrid has been California’s top- selling model for the past two years and helped secure a leading 22 percent market share. It also represents a victory for Texas Governor Rick Perry, who’s made repeated visits to California to lure businesses to his state with promises of lower taxes and easier regulations.
Toyota has more than California 5,300 employees, most at its Torrance campus in sales, finance, marketing, engineering and product planning. Details on which functions will move and when may be announced as soon as Monday, after the employee meeting. When Nissan Motor Co.’s moved its North American headquarters to lower-cost Tennessee in 2006, only 42 percent of employees initially chose to relocate.
Toyota may base its new regional sales headquarters near Plano, Texas, said three of the people who asked not to be named as the plan isn’t yet public. The majority of Toyota’s Torrance operations may move to Texas over a two-year period, the people said.
Texas Drive
Lucy Nashed and Felix Browne, spokesmen for Perry, didn’t respond to e-mails on the matter.
Perry, in his final year as governor, began airing radio commercials in California during his March swing through the state that highlighted its high taxes.
“A year ago, I was here, in California, encouraging companies to look to Texas for expansion and relocation,” he said in the ad, paid for by a group called Americans for Economic Freedom. “Over the past year and a half, more than 50 California companies have announced plans to expand or relocate in Texas, creating more than 14,000 jobs.”
While Texas is home to Toyota’s pickup truck plant in San Antonio and a General Motors Co. factory in Arlington, the state traditionally has not been a center of auto industry activity.
Since Eisenhower
Toyota’s decision to downsize in California where it established operations in 1957 comes as the company expects to report a record 1.87 trillion ($18.9 billion) of net income when it releases fiscal year results next month. Along with rising sales in North America and other international markets, Toyota’s earnings this year are benefiting from a decline in the value of the yen, which surged in 2011.
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