Saturday, October 07, 2006

Toyota upgrading joint US plant with GM

Toyota upgrading joint US plant with GM
Fri Sep 29, 8:29 AM ET

Japan's top carmaker Toyota says it is upgrading a US plant equally owned with ailing General Motors, which has been negotiating an alliance with the French-Japanese Renault-Nissan group.

But Toyota Motor Corp., widely seen as set to overtake GM as the world's top vehicle maker, denied that the new investment in the California plant was aimed at strengthening its partnership with the US car giant.

The plant, run by the 50-50 joint venture New United Motor Manufacturing Inc. (NUMMI), has been producing compact cars since it was established in 1984, initially as Toyota's foothold for North American operations.

"Our company has continuously made capital investment in an effort to create optimum production lines," Toyota spokeswoman Shiori Hashimoto said Friday.

"At the NUMMI, the equipment has been replaced as it became obsolete," she added. "But it is not aimed at strengthening our partnership with GM as reported."

The company refused to give details on the new equipment.

The major daily Yomiuri Shimbun reported that Toyota plans to install its latest technology in the plant in a possible move to demonstrate its strong ties with GM and check the talks between the US maker and Renault-Nissan.

Toyota president Katsuaki Watanabe has said that his company's tie-up with GM and its domestic rival Nissan will remain intact regardless of the outcome of GM's talks with Renault-Nissan.

Apart from the joint plant with GM, Toyota has shared with Nissan its technology related to fuel-efficient hybrid cars.

Watanabe told Japanese reporters on Wednesday in Paris, where he attended the Paris auto show, that his company had been "concerned" about GM's talks with Renault-Nissan.

"But Toyota's relations with GM or Nissan won't change no matter what," he said, according to press reports from Paris. Carlos Ghosn, head of Renault and Nissan, met with GM chairman and chief executive officer Rick Wagoner in Paris on the same day.

Yomiuri said that "tens of billions of yen" will be newly invested over several years from this business year to introduce a cutting-edge production line at the NUMMI plant. Ten billion yen is worth about 85 million dollars.

The daily said that a line which paints cars by emitting little pollutant waste will be installed at the plant this year.

The plant will be also equipped with an assembly line which can adapt to different models quickly and flexibly, the report said.

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