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Toyota Not Likely To Shutdown NUMMI

Last Friday Toyota announced that they may have to abandon NUMMI (New United Motor Manufacturing Inc.). A car plant in Northern California, NUMMI opened in 1984 and is jointly operated by GM and Toyota…or at least it was up until last Friday.

Toyota’s decision to make this announcement on Friday the 10th coincides with the “new” GM’s emergence from bankruptcy . While it’s a little complicated, here’s why that timing is relevant:

1. As part of GM’s bankruptcy plan, a “new” GM was formed. The new GM got all the good, profitable assets.
2. The “old” GM retains all the unprofitable assets.
3. All the assets of the old GM will be liquidated over the next year or two.
4. NUMMI is part of the old GM.

In other words, now that GM has officially abandoned NUMMI, Toyota is considering the same action…and who can blame them? A case can definitely be made: