DETROIT — Toyota, the seemingly unstoppable juggernaut that saw its U.S. sales double in the last decade, has come back to earth.
Stung by rare double-digit sales declines and burdened by a growing inventory of slow-selling pickups, Toyota said Thursday it will start producing the Prius hybrid in the U.S. and will shut down truck and sport-utility production to meet changing consumer demands.
Toyota was the latest automaker to announce major production changes in response to lagging U.S. auto sales. Industrywide, sales have dropped 10 percent in the first six months of this year and are moving at their slowest pace in more than a decade. High gas prices have accelerated the drop in pickup and sport-utility-vehicle sales faster than automakers had predicted, and they’re scrambling to keep up with demand for smaller, more fuel-efficient cars.
“Toyota isn’t immune to $4 gas and the recession in the housing market,” said Erich Merkle, an auto analyst with Crowe Chizek and Co., a Grand Rapids accounting and consulting company. “It’s almost as though Toyota always defies gravity, and in this case, they don’t.”
Toyota said the moves will not affect any full-time workers. But the company is laying off about 700 temporary workers at affected plants.
Prius sales fell 34 percent in June as Toyota failed to keep up with demand for the car, which gets 46 miles to the gallon. Priuses are sitting on the lot for just four or five days before they’re sold, according to Tom Libby, senior director of industry analysis for the Power Information Network, a branch of J.D. Power and Associates. By contrast, the Toyota Tundra pickup is on the lot for 64 days before it is sold.
