GM pulls out of joint venture with Toyota
General Motors has announced its withdrawal from NUMMI, its joint venture with Toyota. NUMMI was an incredibly generous initiative by Toyota to educate its global rival about modern management and production techniques, while giving Toyota insight into operating in the US. Although the NUMMI plant was generally seen as a (qualified) success, and GM learnt about efficient plant layout and just-in-time inventory, it (GM) never really absorbed the “lean business” mindset that infuses every aspect of Toyota.
The NUMMI plant is now 25 years old, and probably long overdue for a major overhaul/replacement. Toyota doesn’t need it, with low demand and its own plants elsewhere in North America making similar models. Politically, Toyota might wait a while to close the only unionised shop in its portfolio, but GM’s reputation is so low, now is probably the least reputation-damaging time for Toyota to do so.
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