Toyota won't rule out layoffs of "permanent" employees

January 12, 2009

DETROIT - James Lentz, president of Toyota Motor Sales U.S.A., yesterday did not rule out layoffs this year of employees the company has considered permanent.

"We don't have a specific policy against layoffs. We have had a practice not to do that," Lentz said as Toyota debuted the new Prius at the North American International Auto Show.

"I can assure we can look and do everything we can so that would be a very last resort," Lentz added.

Toyota announced last month it expects 2008 was its first money-losing year in 70 years and laid off part of its temporary work force, including most of 500 in Georgetown. In recent weeks, Toyota also indefinitely delayed production at a new plant to build the Prius in Tupelo, Miss.

The fact that Toyota would not flatly reject a question of a layoffs "is huge," said Jeannine Fallon, executive director communications at Edmunds Inc., an auto industry publisher based in Santa Monica, Calif. "I think the fact that they won't rule out layoffs sends a huge message."

Unlike in the U.S., layoffs are anathema to Japanese corporate culture, Fallon added.

But auto sales fell to a rate of only about 10 million annually in the latter half of last year, a 30 to 35 percent drop from average sales for years before that.

More: http://www.courier-journal.com/article/20090112/BUSINESS/90112021/1003