Toyota moves deeper into U.S. work cuts

Toyota moves deeper into U.S. work cuts

Lindsay Chappell Automotive News February 12, 2009 - 11:39 pm ET

NASHVILLE -- Still refraining from laying off any North American workers, Toyota Motor Corp. said Thursday night that it is freezing wage, reducing hours and adopting a voluntary exit program.

The new measures, which Toyota dubbed a "shared sacrifice" philosophy, come as the automaker faces its first financial losses since 1950 and the unfamiliar specter of idle factory lines.

Toyota has gone out of its way to keep its mostly non-union U.S. and Canadian production workers on the clock, even as it has shut down assembly lines.

But a statement released by Toyota Motor Engineering & Manufacturing North America Inc., the company's U.S. manufacturing headquarters, said there is now a "strong possibility" that it will reduce work and pay at some plants.

Toyota is considering a schedule in which some workers would work 72 hours in a typical 80-hour, two-week period.

Other provisions

Toyota says it will also: . Add three to eight additional non-production days per factory to its North American schedule through April 30; . Reduce bonuses for hourly workers; . Eliminate bonuses for North American executive and salaried workers; and . Offer no wage increases "for the foreseeable future."

The company will also offer a "voluntary exit program" for workers who want to leave. That plan will provide 10 weeks of pay, two weeks of compensation for every year an employee has worked, and a $20,000 lump payment to any worker who wants to leave.

Spokesman Mike Goss said Toyota has no target to reduce headcount and does not expect many of its employees to leave. Goss also said that the elimination of executive and salaried bonuses represents about a 30 percent reduction in total compensation of the affected personnel.

"We're trying our best to keep everyone employed," Goss said. "We feel that with the reduced work weeks and bonus eliminations, we're getting into the position we need to be in."

Reply to
C. E. White
Loading thread data ...

MotorsForum website is not affiliated with any of the manufacturers or service providers discussed here. All logos and trade names are the property of their respective owners.