Toyota’s Camry will no longer be assembled under contract by Subaru of Indiana Automotive when the latest agreement ends at the end of 2016, US media reports said.
The Lafayette plant has built Camrys alongside Subaru’s Legacy, Outback and Tribeca models since 2007, supplementing Toyota’s own output in Kentucky and the odd import from Japan.
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“Based on changes in Toyota’s production plans, they have decided that the award-winning Camry production contract will not be renewed,” Tom Easterday, SIA’s executive vice president, was quoted as saying by USA Today and other papers.
Toyota is the top shareholder in Subaru, holding a 16.5% stake.
Easterday said he does not expect any reduction in SIA’s workforce in light of the announcement but an announcement the company made back in May about adding hundreds of jobs may not come to fruition as quickly as he expected.
Subaru executives announced in May that the Lafayette plant would begin producing the Impreza by the end of 2016. That was to add 900 jobs to SIA’s workforce of 3,600.
Easterday said the jobs created by the Impreza expansion will “more than offset” any Camry-related loss.
“There will be no loss of jobs at SIA as a result of this,” Easterday said. “We also know there are future projects that Subaru has in mind for our plant that should add several hundred jobs in the future, possibly by 2018.”
The Toyota Camry, which is also built at a plant in Georgetown, Kentucky, is America’s best-selling car. When the first one rolled off the line in Lafayette, it was the result of a $230m investment that gave SIA the capacity to produce 100,000 a year.
Easterday said the announcement came as a surprise.
“We had been informed back in the spring that we would be building the next generation Camry,” Easterday said.
Despite the news, Easterday said expansions to the paint shop, engine assembly shop and trim shop would continue. Employees who primarily worked on Camry production will be retrained to work on Subarus.
The Camry leaving Lafayette means the plant could end up producing another Subaru model, Easterday said.
“Even though we’d like to continue producing the Camry,” Easterday said, “this decision does open up the possibility of SIA’s production of another Subaru (model).”
