Toyota began ramping up production to ride out any strike that may hit its ability to ship cars around the world
U.S. dockworkers on the East Coast and Gulf Coast walked off the job Tuesday, kicking off the first large-scale work stoppage among dockworkers in nearly 50 years. The move is predicted to have an enormous impact on global shipping and the automotive industry as new vehicles are slow to come in and out of America.
Now, it’s emerged that Toyota $TM saw this coming, so began ramping up production to ride out any strike action that may hit its ability to ship cars around the world, reports Reuters. The Japanese automaker, which operates plants in places like Mississippi, Alabama, Texas and Tennessee, built up its inventory of vehicles and parts ahead of the U.S. port strikes, as Reuters reports:
Toyota, which relies on the U.S. East Coast and Gulf Coast ports to import everything from vehicle components to fully-built cars, said it was closely monitoring the situation.
Dockworkers on these coasts began a strike, their first large-scale stoppage in nearly 50 years, after negotiations for a new labor contract broke down.
“We built up some extra stock here over the last couple of weeks to help us buy a couple of days’ worth of inventory,” said Jack Hollis, chief operating officer at Toyota’s North American unit.
The company had plans that it could implement to change ports and locations, Hollis said.
“It would just be crippling to the economy if this goes on for too long,” he added.
While Toyota might claim the increased inventory was in preparation for the dockworkers strike, it did also reveal this week that sales for the third quarter of 2024 were down by “about eight percent,” according to Reuters. The drop in sales was attributed to fewer selling days last quarter, as well as “inflationary headwinds.”
Toyota posted sales of 542,872 units for Q3 of 2024, which follows similar drops in demand from automakers like Nissan and General Motors $GM.
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