Toyota confirmed today that the company will move its North American headquarters to Plano, Texas, meaning a major loss of jobs in Torrance, where the mayor expressed sadness but said he hoped the city would be able to attract another major employer.
According to Toyota, the move -- which will be made over the next three years -- will consolidate operations from Torrance, New York and Erlanger, Ky.
The move of Toyota Motor Sales USA out of Torrance will affect 2,000 employees, according to Toyota. The Toyota Financial Services division in Torrance will not begin moving until 2017, affecting another 1,000 employees.
"With our major North American business affiliates and leaders together in one location for the first time, we will be better equipped to speed decision-making, share best practices and leverage the combined strength of our employees," said Jim Lentz, Toyota CEO for the North American region. "This, in turn, will strengthen our ability to put customers first and to continue making great products that exceed their expectations.
"Ultimately, enabling greater collaboration and efficiencies across Toyota will help us become a more dynamic, innovative and successful organization in North America," he said. "This is the most significant change we've made to our North American operations in the past 50 years, and we are excited for what the future holds."
The company noted that it will continue to have 2,300 employees in California. It also announced a $10 million "philanthropic commitment" for nonprofit and community organizations over the next five years in the states affected by the job losses, beginning in 2017.
Torrance Mayor Frank Scotto said he was "saddened about the news."
"We hope that everybody understands that Torrance has done everything we can to keep them here," he said. "And we hope that we attract another company like that."
Scotto said Toyota "has been a great partner with the city of Torrance."
"We look forward to working with Toyota, making it a good transition for them," he said, adding that the city will be looking for another major corporation to move in. He said the Toyota campus covers 101 acres.
"Torrance has been known (as) a business friendly city for years, and we do a number of things in this city to make the environment in Torrance a great place," he said.
Toyota originally selected the Greater Los Angeles area for its first North American headquarters because of proximity to the port complex, through which it imported cars, and easy airline access to Tokyo, the Los Angeles Times reported. As Toyota grew, it opened its national sales and marketing headquarters in Torrance in 1982. The complex now has 2 million square feet of office space.
Today, about 75 percent of Toyota vehicles sold in the United States are built not in Japan but at plants in Texas, Mississippi and Kentucky. Moving corporate headquarters to Texas will put senior management closer to those factories.
In 2005, Nissan announced it was moving its North American headquarters from Gardena to Franklin, Tenn., outside of Nashville. About 550 employees left for Tennessee; an additional 750 left jobs at Nissan to stay in Southern California.
Toyota is not the first big California-based company to announce a move to Texas. In February, Occidental Petroleum Corp. said it was relocating from Los Angeles to Houston -- one of around 60 companies that have moved to Texas since July 2012, according to Texas Gov. Rick Perry.
--City News Service