A Toyota spokesman has denied reports in Japanese media that the company has decided to temporarily abandon its plans to build its first assembly plant in Russia, ITAR-TASS reported on Friday.
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“We are considering local production in Russia from various perspectives,” including changes in the market environment, the spokesman reportedly said. “But no concrete details, such as the timing, have been set yet. There is no truth that the plans (for production in Russia) have been frozen.”
Prime-Tass noted that the comment came after conflicting newspaper reports earlier on Friday.
The Nihon Keizai Shimbun reportedly said Toyota is finalising plans for a plant to produce its Camry sedan in St. Petersburg for an investment of about 15 billion yen. However, the Sankei Shimbun reported that Toyota has told Russia it has frozen plans to build a plant there.
According to the Sankei Shimbun article, Toyota decided to freeze its project in Russia because it realszed that it would not be able to handle an over-expanded network of plants abroad, given that the company is running short of managers and engineers, ITAR-TASS reported.
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By GlobalData“As this would mean the loss of a focal (future) project in (Japan-Russia) economic ties, Russian President Vladimir Putin may give up plans to visit Japan by the end of the year,” a Japanese diplomat said, as quoted in Sankei Shimbun.
However, Russia requested that the plant’s functions be spread out to various sites to economically develop a wider area, the paper said. Toyota countered that this would make quality control harder, the paper said.
According to Japanese media, the project is basically ready and is waiting the approval of Toyota’s management, ITAR-TASS said. The project envisages building an assembly plant in St. Petersburg with an annual production capacity of 50,000 cars, ITAR-TASS reported. The project envisages the plant commencing operations in 2007.
Toyota was expected to decide on the site for its assembly plant in Russia in February, Grigory Dvas, governor of Russia’s Leningrad Region, said on January 27.
Toyota’s president Fujio Cho said on January 20 that the company had postponed starting construction of an assembly plant in Russia.
Cho reportedly said that it would take “a little more time” before the company builds an assembly plant in Russia. He did not give any specific dates.
On November 1, 2004, Hiroshi Okuda, chairman of Toyota’s board of directors, said that the company planned to build an assembly plant in Russia by 2006, Prime-Tass noted.
