TOKYO -- Toyota Motor Corp. wont bear the full cost of shuttering its California joint venture with General Motors even though GM has abandoned the project, a Toyota executive says.
GMs withdrawal does not mean that Toyota has to bear all the expenses for NUMMI, said Takahiko Ijichi, Toyota senior managing director. We are even 50 percent shareholders, and our liability is within that contribution.
GM in June put its 50 percent stake in New United Motor Manufacturing Inc., or NUMMI, up for sale as part of the old GM under its Chapter 11 reorganization -- sparking debate about its future. Toyota, which owns the other half, has since said liquidation is one option.
Ijichi said today that his company is negotiating NUMMIs fate with Motors Liquidation Co., the entity that has taken over management of GM assets left in bankruptcy. Motors Liquidation now holds the old GM stake in NUMMI.
The Fremont, Calif., joint venture was launched in a closed GM factory in 1984 to share car production between the global competitors. Today NUMMI is the only Toyota assembly plant in the United States whose work force is represented by the UAW.
Analysts say a liquidation would likely result in a one-time loss. But it would help Toyota in the long run by raising the rate of capacity utilization at its other North American factories.