Fleeing California: Toyota takes its business (and its jobs) to Texas

April 28, 2014

Moving

Oh, man, this is just a gut punch to the Southern California economy:

Toyota Motor Corp. plans to move large numbers of jobs from its sales and marketing headquarters in Torrance to suburban Dallas, according to a person familiar with the automaker’s plans.

The move, creating a new North American headquarters, would put management of Toyota’s U.S. business close to where it builds most cars for this market.

North American Chief Executive Jim Lentz is expected to brief employees Monday, said the person, who was not authorized to speak publicly. Toyota declined to detail its plans. About 5,300 people work at Toyota’s Torrance complex. It is unclear how many workers will be asked to move to Texas. The move is expected to take several years.

I don’t know how many will move to Texas, but I bet several thousand won’t. And that doesn’t even address the ripple effects in the region’s economy, all sorts of support businesses that would lose the revenue spent by those employees — restaurants, dry cleaners, janitorial companies, you name it. Those people won’t be heading for Texas; they’ll be stuck here. And it’s going to hurt.

Toyota originally came to LA in the late 1950s, and staying here made sense for them for a long time, in spite of increasingly burdensome taxes and regulations. After all, most of their cars entered the US through the huge Port Of Los Angeles, so it made sense to have the North American HQ nearby.

But, with the passage of time, Toyota, like so many foreign car manufacturers, built more and more of their cars here in the US, mostly choosing to construct their facilities in business-friendly Southern states… such as Texas. The last auto manufacturing plant in California, coincidentally Toyota’s, closed in 2010. Eventually, economic logic (1) lead the company to decide that the cost of living and business in California wasn’t worth staying in California, not when their manufacturing operations had all shifted to Texas and nearby states.

As Dale Buss writes at Forbes. After talking about the structural shift in Toyota’s business, he looks at the once-Golden State:

Besides, California’s business climate is becoming an even bigger downer. California has become infamous with business executives and owners there not only for high tax rates and complex taxing schemes but also for overzealous regulations and regulators that have managed to stifle the entrepreneurial energy of thousands of companies.

Even Hollywood movie studios have been souring about producing flicks in California, increasingly reckoning that the sweet tax breaks and assistance packages now offered by so many other states offset the legacy advantages and ideal production climate in California.

About the only vast remaining pocket of dynamism in the California economy is Silicon Valley, where the mastery of the global digital economy by companies ranging from Google to Hewlett-Packard has become so complete that they have been able to succeed despite the home-state business landscape.

In the annual Chief Executive magazine “Best States / Worst States” ranking that surveys CEOs for their opinions, Texas has been holding on to the No. 1 spot for a while; California seems permanently relegated to No. 50.

As Automotive News put it, “Despite the deep, creative talent pool in greater Los Angeles, doing business in California has become more expensive for companies and their workers.” Bestplaces.net said that the cost of living for employees is 39 percent higher in Torrance than in Plano, and housing costs are 63 percent lower in Plano.

Thus, over the last 10 years, the Lone Star State has stolen so many jobs from the paragon of the Pacific Coast that Toyota’s reported move should come as no big surprise.

No, it’s no surprise, but it is maddening because it is a largely self-inflicted wound. Business flight has been going on for a few years, now, and, no, “Green jobs” just aren’t going to fill the gap. Heck, a businessman even set up a consulting firm to help companies “abandon ship.”

Losing Toyota should be a loud, blaring alarm for Governor Brown and the progressive oligarchs who dominate our legislature, for it’s their policies, piling on regulations and taxes year after year, decade after decade, that have made it nearly impossible to build a business here. (Just read this “Dear California” letter from a small businesswoman who’d had enough.) And for those companies that had been successful, the incentive to move finally grows too great to resist. But they won’t learn, not until it gets much worse. Like all good oligarchs, they’re isolated in their ivory tower of safe seats and unaccountability (2).

Keep watch at the I-10 crossing into Arizona: pretty soon, a lot of those taillights you see  heading East are going to be on the back of Toyotas.

And they ain’t coming back.

Footnote:
(1) Something progressives should acquaint themselves with, sometime.
(2) And, before anyone else can say it, yes, that’s our fault as voters.

(Crossposted at Sister Toldjah)


It’s not just #Obamacare that’s a flaming wreck

December 2, 2013
x

Obama Green Tech adviser at work

Remember all the public money “invested” in supposedly Green electric vehicles of the future? Seems like a fair portion of it has gone up in smoke. National Review has a brief summary of electric vehicles that have caught fire. Here’s one:

2. A parked Chevy Volt combusts.
In 2011, Bloomberg reported that a Chevy Volt in Wisconsin had ignited. Ironically, the car was parked outside a National Highway Traffic Safety Administration testing center where it had undergone tests three weeks earlier. The blaze was big enough to burn other nearby vehicles, according to reports.

If electric vehicles do ever catch on –as opposed to catch fire– it will be when there is a genuine economic demand for them, not a government mandate.


The potential threat to liberty in driverless cars

September 3, 2013
And he's driving, too.

And he’s driving, too.

Yesterday, I wrote about the European Union proposal to mandate speed governors on all cars, which would be automated to force a driver to slow down, should he exceed the legal speed limit. As an aside, I mentioned the trend toward driverless cars and the potential for state control of those.  (And hacking, let’s be honest. But that’s another issue.)

Jonah Goldberg thought along the same lines this morning and imagined some of the “fun” we could have:

Let’s be fair: The experts aren’t always wrong, and even when they’re wrong, their arguments aren’t necessarily unreasonable given their assumptions. But if you follow the logic of mandatory seatbelts and motorcycle helmets, red-light cameras and anti-texting laws (1) to their natural conclusion, it’s easy to imagine that some bureaucrats will want to co-author your car’s software.

And then what? Will you ever be allowed to go over the speed limit again? Police are already drooling to see our GPS data. Will that become automatic too? Will the cops have the power to tell your car to stop whether you want it to or not? Will authorities be able to tell your car to take a detour to alleviate traffic? Make it turn around when it gets too close to certain off-limit areas?

Whoever thought that driving your own car could be the next “live free or die” moment?

Footnote:
(1) I am, however, strongly in favor of laws against cell phone use and texting while driving, having nearly been run down several times by people paying more attention to their phone than to the road. Studies show phoning while driving is as impairing as driving while drunk. And texting isn’t much better.

(Crossposted at Sister Toldjah)


European Union to put speed limiters on all cars?

September 2, 2013
I said, no fun allowed!

Nanny says “Slow down!”

The world’s biggest nanny-state has decided that too many people are dying on Europe’s highways. Rather than leave that problem up to the member nations, the Euro-mandarins in Brussels have proposed to put speed-limiters, some of them satellite-controlled, on all cars. Go too fast, and Nanny puts on the brakes:

Under the proposals new cars would be fitted with cameras that could read road speed limit signs and automatically apply the brakes when this is exceeded.

Patrick McLoughlin, the Transport Secretary, is said to be opposed to the plans, which could also mean existing cars are sent to garages to be fitted with the speed limiters, preventing them from going over 70mph.

The new measures have been announced by the European Commission’s Mobility and Transport Department as a measure to reduce the 30,000 people who die on the roads in Europe every year.

A Government source told the Mail on Sunday Mr McLoughlin had instructed officials to block the move because they ‘violated’ motorists’ freedom. They said: “This has Big Brother written all over it and is exactly the sort of thing that gets people’s backs up about Brussels.

“The Commission wanted his views ahead of plans to publish the proposals this autumn. He made it very clear what those views were.”

I’d like to think the minister illustrated his point with the traditional English two-finger salute. And this should be really popular in Germany, where the “need for speed” on the autobahns is a well-known national trait. So, what’s next? EU directives on how one shall cut one’s steak, with a minder showing up to measure each piece with calipers to make sure it isn’t too large?

This is another illustration of the control-freak nature of the Left (1): it’s not enough to set speed limits and levy fines for violating them, nor even to suspend driving privileges for repeat violations. Nope, they have to stand over you constantly lest you pass the bounds of what they determine to be proper. Go too fast, and Nanny will make you slow down.

Democrats in Washington and Sacramento must be green with envy.

Afterthought: Speaking of which, driverless cars are on the way. Who needs speed limiters when bureaucrats can control the whole vehicle? (2)

via David Burge

Footnotes:
(1) The whole European Union government is a statist paradise. The small-government, liberty-of-the-individual politician is a rare sight.
(2) Please. It’s only a matter of time before some progressive genius decides driverless vehicles should have Internet-based governors on them. For your own good, of course.

RELATED: Dan Mitchell make this part of his question of the week – “What’s More Worrisome, Big Brother Monitoring Where You Drive or Big Brother Controlling How You Drive?”

(Crossposted at Sister Toldjah)


Lomborg: Californians are paying ridiculous subsidies for electric cars

May 12, 2013

Phineas Fahrquar:

Yet another “Green scam.” Makers of fossil-fueled cars are forced to buy, in essence, “carbon credits” from Tesla to meet California’s “zero emission” standards. You can bet those costs are passed along to the consumer.

Originally posted on Watts Up With That?:

English: The Tesla Model S is an all-electric ...

The Tesla Model S is an all-electric sedan. (Photo credit: Wikipedia)

 Guest post by Bjørn Lomborg

I’ve said electric cars get subsidized too much. Turns out I was wrong.

In California, they are subsidized ridiculously too much.

Tesla gets $45,000 for each car it sells in state and federal subsidies. The Tesla S starts at $69,000, so about 40% of its total cost is subsidies (Tesla isn’t making any big profits).

This is because the California Air Resources Board has mandated that zero emission vehicles should comprise 15% of new-car sales by 2025 — up from less than 1% now. This forces other car companies that can’t comply to pay for credits from Tesla.

View original 143 more words


Fighting for good union jobs, Obama administration buys…. foreign cars

January 10, 2013

I’m sure UAW will understand:

President Barack Obama’s administration, which set a goal of buying only alternative- technology vehicles for its fleet by 2015, cut purchases of hybrid and electric models by one-third last year and bought mostly Asian brands.

About 54 percent of the 1,801 alt-fuel vehicles purchased by U.S. government agencies last year were built by Hyundai Motor Co. (005380), Toyota Motor Corp. (7203), Mitsubishi Motors Corp. (7211) and Honda Motor Co., according to data obtained under a Freedom of Information request from the U.S. General Services Administration, which coordinates most vehicle purchases.

The Korean-made hybrid version of the Hyundai Sonata unseated Ford Motor Co. (F)’s Fusion hybrid as the top-selling alternative-technology vehicle purchased for the federal fleet. U.S. hybrid purchases in previous years were made almost exclusively from domestic automakers.

The problem is that they’re trapped by their own Green ideology: committed to “alternative fuel” vehicles, they have to buy from foreign companies because there aren’t enough models produced in the US. (And some have a bad habit of catching fire…)

But try to explain that to the northern auto worker who’s facing layoffs from declining sales. Wasn’t the whole point of the bailout and partial nationalization to save their jobs, no matter what the cost to the taxpayer? Shouldn’t the Obama administration “buy American?” (Including fire-proof suits?) Shouldn’t the US autoworkers being wondering what in heck they’re getting in return for their blind loyalty, votes, and millions in dues funneled to Democrats?

(And I’d be glad if they did start asking those questions, since it might provide some much-needed enlightenment.)

Honestly, I’ve no problem with the government buying cars from whatever source, just as long as they’re getting the best deal for our tax money. (Of course, by definition that leaves out almost anything that’s “Green,” because of the heavy government subsidies required to make them competitive in the marketplace.)

I’m just amused at the knots the administration ties itself in, shafting one client group to please another. One of these days, all those patronage balls the Democrats are juggling are going to come crashing down.

(Crossposted at Sister Toldjah)


I’m not sure if this ad makes me want to buy a Prius

March 19, 2012

But it does leave me wanting to do something to the people who made it. Something bad.

I hold out a vague hope that some high honcho, somewhere in the vast corporate behemoth that is Toyota, looked at this, turned to their marketing guy, and asked “WTF were you thinking??”

via @KevD through Jim Geraghty’s Morning Jolt


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