Toyota races to raise Prius C supply in U.S.
Japan plant ekes out more small-hybrid capacity
Photo credit: HANS GREIMEL
KANEGASAKI, Japan -- Toyota Motor Corp. is churning out a meager 6,000 units a month of its Prius C small hybrid for North America because of supply constraints and soaring demand in Japan. But more cars should be on their way by midyear.
The car went on sale in Japan on Dec. 26 and hits U.S. showrooms this month.
But an initial backlog of 120,000 orders for Japan, where it is sold as the Aqua, has put U.S. allocation in jeopardy. So has the yen's exchange rate against the dollar, which crimps profits on Japan-made cars and pushes Toyota to prioritize domestic sales.
The car is made only in Iwate, northern Japan, at a plant run by Toyota's assembly affiliate Kanto Auto Works Ltd. That factory had exported about 60 percent of its output in 2007, before the yen started a four-year rise against the dollar.
Now it exports only 30 percent of its production, executives say.
The company is working on a couple of tweaks to get more of the pint-sized Prius, Kanto President Tetsuo Hattori said during a factory tour.
First, plant managers are pushing through efficiencies that when combined should increase overall capacity at the plant, he said.
Also, production of one of the plant's other models, the Ractis, will shift gradually to Kanto's Higashifuji assembly plant west of Tokyo starting in May.
"The extra capacity we gain from the transfer will be put toward Prius C or Aqua," Hattori said. He declined to say how much extra capacity could be eked out.
The Iwate plant churns out about 30,000 Prius C units a month for an annual rate of 360,000 units.
That is up from an original plan of 240,000 units and accounts for 80 percent of the plant's output. Only 20 percent of the units are earmarked for export.
The Ractis small car, sold only in Japan, accounts for the lion's share of the remainder. But the plant also produces smaller volumes of the Scion xD, the Belta -- a sedan version of the Yaris for sale in Japan -- and the Blade hatchback.
"We have to produce other models too, so we are running at quite high utilization," Hattori said. "We are looking at ways of satisfying the demand of all our customers."
Hattori said he was unaware of any talk about creating more Prius C capacity by adding production at another plant. But he said Toyota is reviewing its groupwide manufacturing strategy in Japan for April and May.
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