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Toyota to begin hybrid powertrain production in US; $374M investment in 5 plants

Toyota is expanding the production of its hybrid powertrains to the US. Toyota will invest $373.8 million in five US manufacturing plants to support production of its first US-made hybrid powertrain and to implement Toyota’s New Global Architecture (TNGA) at its Alabama plant. Each of the projects is scheduled to begin this year and all should be operational by 2020.

The investments will include adding new production of hybrid transaxles (hybrid vehicle transmissions) at the Buffalo, West Virginia, manufacturing facility; expanding 2.5-liter engine capacity at the Georgetown, Kentucky, plant; increasing production of 2.5-liter cylinder heads at Bodine Aluminum’s Troy, Missouri, plant; and modifying the Bodine Jackson, Tennessee, plant to accommodate production of hybrid transaxle cases and housings and 2.5-liter engine blocks. The Huntsville, Alabama, plant will undergo a comprehensive upgrade to enable it to build engines that complement TNGA.

The 2.5-liter engines manufactured in Kentucky and transaxles made in West Virginia will be used in hybrid vehicles built in North America such as the Highlander Hybrid manufactured in Princeton, Indiana. Toyota remains the world leader in gasoline-electric hybrids, surpassing 3 million sales in the US and 10 million globally.

Cutaway of Toyota hybrid transaxle. Click to enlarge.

Fifty new jobs will be created because of the investment at the Alabama plant. There will be no net gain of jobs at the Kentucky, West Virginia, or Bodine Aluminum facilities, but these investments will help to ensure the stability of the plants’ employment levels in the future.

This investment across five American plants expands capacity for our latest TNGA engines, and localizes production of hybrid powertrains, a core Toyota technology. It underscores Toyota’s confidence in the capability and global competitiveness of our North American manufacturing.

—Jeff Moore, senior vice president for Manufacturing

The total investment of $373.8 million will be distributed as follows:

  • Toyota Motor Manufacturing, KY – $120,960,000
  • Bodine Aluminum Jackson, TN – $14,500,000
  • Toyota Motor Manufacturing, WV – $115,300,000
  • Toyota Motor Manufacturing, AL – $106,000,000
  • Bodine Aluminum Troy, MO – $17,050,000

These projects, and others previously announced, move Toyota nearly halfway ($4.1 billion) toward its commitment to invest $10 billion in the US, as announced by Toyota Motor Corporation CEO Akio Toyoda in January 2017.

Toyota operates 14 manufacturing plants in North America (10 in the US) and directly employs more than 46,000 people (more than 36,000 in the US).



Toyota is the world leader with various size high quality Hybrids on the market place and more coming out soon.

When will Toyota start the mass production of BEVs and increase the production of various FCEVs?


HD: Me thinks they are laying the ground work in the U.S. for future BEVs.

Interesting they sold their huge plant in California to Tesla; I wonder what was the thinking behind that at the time; and, did they foresee Tesla eating their lunch?

Brian P

The California plant was a joint venture with GM. California is an expensive place to do business. And Tesla is hardly eating Toyota's lunch.


With a JFY16 Gross Revenue of $247B (over 10M cars and lots of other stuff) Toyota Motors paid $6.6B to shareholders in the form of dividends, bought back $6B in shares, and still managed to invest almost $9B in R&D and $11B in CapEx while finishing with positive change in Cash and Cash Equivalents. Cash Flow from Operations ($30B) exceeded the combined total of net borrowings ($9B) by more than 3X.

With a 2016 Gross Revenue of $7B (just under 80k cars, some solar leases, and a handful of storage bnatteries) Tesla issued shares to the tune of $2B, and the ratio of $1.7B in net borrowings to operating cash flow had no meaning since, once again, Cash Flow from Operations was negative. With all that financing and borrowing Tesla did manage to spend $834M in R&D and $1.4B in CapEx.

Tesla can get a lot of people to send them money for the next promise of Visionness and Disruptivity. But I think in terms of lunch-stealing the Cali lad only managed to run off with a Skittle or two from the ziploc that Toyota's mom packed in his lunch pail. Tesla strutted around the lunchroom and bragged about it, but the quiet Nipponese boy still maintains an admirably large foot-long po' boy, a big bag of fuego Takis, a 20oz. tea, a snack bag of wasabi peas, and a big honeycrisp apple. Plus most of his Skittles. (Toyota doesn't carry a bento when he's Stateside -- big lunches only, mom.)

But I'll admit those little candies are tasty.


I heard from reliable sources that Toyota's BEVs and PHEVs have been held back by high cost and low performance of current EV lithium batteries.

Their own SS Batteries have not panned out as expected and are not mass produced yet.

Near future (2022/2025?) affordable 2X and 3X SS batteries may be enough to convince Toyota to mass produce affordable PHEVs and BEVs?


They are in EV production and it's quite tasty.
Wonder how Tesla makes a profit if California is such an expensive place to do business. Perhaps the difference is Tesla pays a decent wage to it's workers and it's not all about trying to satisfying the greed of management. But I will give you it's not as cheap as where Toyota moved their Headquarters...starts with a "T."


"Wonder how Tesla makes a profit if California is such an expensive place to do business"

I have your answer: they don't make a profit.


At this stage they are a growth company and plowing their profits back into the business...but they could quit their growth pattern and settle to just making a's just a Wall Street accounting game at this point in their development.

Do I detect a bias there? Not necessary enamored with Tesla here; but, they are at least making progress in EVs while the Toyota company, like many others, appears to be happy just waiting.


BTW Dyson will be making a car by 2020.


No bias here, Lad: realism. Tesla has taken the world's imagination by storm and energized the EV movement more effectively than anyone expected.

All good.

But they aren't plowing profits back into the business. Excepting 2014, SG&A and interest expense ate more than their total gross margin. That's BEFORE any R&D is accounted. Looking at the balance sheet: all the Capital Investment has been paid for through borrowing or sales of shares and/or convertible bonds. Excepting a couple of quarters, Tesla has never generated cash from operations; as a net they've burnt over $1B just building product and keeping the lights on -- that's before a dime of CapEx. That's Tesla's filings talking here; I'm just telling you what they say.

Toyota has delivered over 10 Million hybrid autos since they started with the Prius. Like it or not, the energy equation for the CHO-burning world currently makes hybrids the best net saver of emissions for private mobility except for PHEVs. Yes, better than pure BEV's, and yes, that is changing rapidly.

But in the meantime the core activities of making EVs (affordable and efficient power electronics and motors, robust controls, etc.) continues to be led in the industrial world by Toyota, all while we witness a rapidly developing global commoditization that's outstripping everyone's expectations.

The future of batteries is unwritten and no doubt extraordinary. While Tesla's mass(ively)-produced 2170 will likely set a cost and packaging standard, it will be fleeting. Tethered H2 vehicles will enter the scene more commonly than any of us (me included) expected. And ICEs have a surprisingly vibrant path ahead as well. You haven't seen the end of them. The coming times are excellent for consumers, which means brutal and bloody for manufacturers.

Currently only five automobile companies truly make money (WACC/ROIC ratio > 1): FHI's Subaru, Great Wall, Suzuki's Maruti venture, BMW, and Daimler.
Nope, not Toyota, but they are close.

Tesla is WAY below the crowd, not only <1 but negative. Tesla does not make money: Tesla Raises money, and very effectively I might add.


... and the sharp-eyed among you must have seen I inverted the ratio. That should be ROIC/WACC>1 as a money-making measure.


Toyota's step by step (55+ empg HEVs, 100+ empg PHEVs, 100+ empg FCEVs and 120+ empg BEVs) may end up by being the most effective approach to reduce pollution and GHG.

Sometime after 2020, Toyota may still be number one (or close to) with 20,000,000+ mass produced electrified vehicles.

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