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Floor mats force recall of 3.8 million Toyota and Lexus vehicles

September 29th, 2009 1 comment

In response to a recent accident in California that involved fatalities, Toyota is issuing a recall of 3.8 million Toyota and Lexus vehicles because the company says the floor mats can interfere with the accelerators.

Included in the recall is the 2005-2010 Prius Hybrid. The Prius is scheduled for production in Blue Springs, though a starting date has not been set.

The 3.8 million vehicles is the largest U.S. recall the company has ever issued. Magnolia Marketplace ran a Google search and was able to come up with only one link, which is here.

UPDATED AT 3:40 p.m. : Details of the accident responsible for the recall can be found here.

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IHL confronts fiscal reality

September 24th, 2009 No comments

“We are not here to moan and cry.”

That was College Board President Scott Ross’ opening line to the Joint Legislative Budget Committee this morning as the Institutions of Higher Learning presented its FY2011 budget request. The JLBC has spent this week telling state agencies that money is slim and could get slimmer before the next fiscal year begins next July.

IHL submitted a request that is $42.8 million more than it received in FY2010. Seventeen million dollars of that will pay for a cost of living adjustment that will allow for colleges and universities to keep the purchasing power it has as the price of goods and services rises, IHL Commissioner Dr. Hank Bounds told lawmakers.

The bulk of the rest of the additional funding is made up of $21 million for the University of Mississippi Medical Center.

“Our big need is to increase our school size,” said interim UMC Chancellor Dr. James Keeton. UMC has 120 medical students, which is all the school can handle with its current size and resources, Keeton said. “We would like to grow that to 150.” While the extra $21 million wouldn’t cover the full cost of growing the student body to 150, it would be a start, Keeton said.

In a nod to the state’s dwindling tax revenue, Bounds said he has talked with all eight university presidents about the idea of consolidating some functions like purchasing, the contract 403(b) notification requirement administration and the IRS 125 administration.

“They are all open to that,” Bounds said.

Lt. Gov. Phil Bryant said he was “stunned” at that announcement, since the consolidation of any state service has long been a subject most lawmakers and state agencies have refused to even discuss.

“We can’t afford to wake up three or four years from now and have mediocre programs,” Bounds said. “We have to think differently. We also recognize that if all (economic) prognosticators are accurate, we could see some really tough days ahead.”

Bounds did not have a cost savings estimate consolidation of some functions might provide. He did say that IHL is preparing to receive fewer state funds in future budget years, and that there is a plan in place to operate the system in such an event.

The budget Bounds and other officials presented Thursday morning, which totals $841.5 million, is about $200 million less than the budget they originally planned to present. The first budget, Bounds said, would have brought funding for Mississippi’s colleges and universities up to the Southeastern average.

Bounds spent a several minutes selling higher education as a driver of economic development in Mississippi.

“I really believe we can only educate ourselves out of the financial crisis,” he said. “It is absolutely clear that if Mississippi is going to move forward we have to produce a better-educated citizenry.”

Mississippi needs more graduates who fall into the STEM category — Science, Technology, Education and Math, Bounds said.

The funds available for the Mississippi Tuition Assistance Grant, which awards $500 per semester to entering freshman who have at least a 15 on the ACT and a 2.5 GPA, are low. The funds are at the same level they were in 2000, but the number of students who are eligible has seen “an appreciable gain,” Bounds said.

With state money in a sharp decline and enrollment up at nearly every institution, Bounds could not rule out tuition increases to make up the difference.

“We will do everything that we can (to prevent tuition increases),” Bounds said. “But I can’t guarantee they won’t go up.”

House Appropriations Committee Chairman Johnny Stringer, D-Montrose, told Bounds he would do “all I can” to get IHL’s budget funded at the level it requested.

The IHL’s presentation took up the vast majority of this morning’s hearings. Afterward, the Mississippi Development Authority presented a budget request of $22.6 million, which is the same amount it got in FY10. The MDA’s state funding has been basically level since 2003. Federal money makes up most of its budget.

“We cannot afford to lose momentum right now,” MDA Executive Director Gray Swoope told the Committee.

Swoope said that Nissan continues to fulfill the Memorandum of Understanding it signed with the state regarding direct job numbers — the company employs about 3,100 people directly — and Toyota is still “fully committed to Mississippi. They are going to build vehicles in Blue Springs.”

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Former Toyota counsel amends complaint

September 22nd, 2009 No comments

The budget hearings continue this afternoon at the Woolfolk Building, after a marathon session this morning, but Magnolia Marketplace is at the Official Magnolia Marketplace Cubicle working on some stuff for the paper edition of the Mississippi Business Journal. That doesn’t mean we can’t pass along some news.

I wrote a story for the Sept. 14 edition of the MBJ that detailed a former Toyota lawyer’s suit against the company. The attorney, who was the architect of the company’s defense against rollover lawsuits that were so popular several years ago, claimed that Toyota destroyed evidence and hindered his investigations into accidents, both of which allowed vehicles that did not meet federal roof crush standards to remain on the road.

In response to the lawsuit, Toyota issued a blistering statement that basically said Dimitrios Biller, the plaintiff, had failed to perform his duties while employed by the company and had “grossly mischaracterized” Toyota’s reporting to the National Highway Traffic Safety Administration.

In his response to the press release, Biller has filed an amendment to his original complaint that accuses Toyota of defaming him. The details are here.

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Toyota betting $1 billion on recovery

September 17th, 2009 No comments

The horses for the regular edition of the MBJ are in the barn for the most part, but there’s some news to pass along before we turn our focus completely to tonight’s Georgia Tech-Miami game. (Magnolia Marketplace has never been a fan of ACC football, or the ACC in general, but that Georgia Tech spread option offense is fun to watch.)

Down to business:

The annual Toyotathon sales drive will have a little extra punch when it starts in November.

Toyota is spending $1 billion on a marketing drive designed to boost U.S. sales in the fourth quarter, which has traditionally been a strong period for all automakers. A company spokesman says that is a new record for ad spending in one quarter.

The spokesman goes on to say that Toyota is confident that the automotive sales market, which has been decimated during what is now being called “The Great Recession”, is on the brink of making a comeback.

It’s impossible to tell if Toyota’s gamble will pay off. But think back to last September, when the first wave of fear was strangling the economy, and a lot of folks were terrified that the U.S. was in a nosedive toward a depression. A lot of that fear is gone, and folks will argue until their last breath the reasons behind it, but the reality is this time last year Toyota would have not even considered spending such a huge sum of money on advertising and marketing in one quarter. Now they are.

And now let’s hope that everybody buys a Prius so we can get that plant in Blue Springs humming.

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Looking back and looking ahead

September 14th, 2009 No comments

Pretty intense football weekend, wasn’t it? Georgia and South Carolina came down to the wire. Notre Dame lost to Michigan in the worst way possible, as did Ohio State to USC. New Mississippi State coach Dan Mullen’s first SEC game would have gone a lot better had Tim Tebow still been his quarterback. Ole Miss was in a slugfest with H1N1.

Magnolia Marketplace was unusually quiet last week, thanks to a combination of a server that has yet to behave the way it should, and a mountain of work on long-term stuff.

The regular edition of the MBJ published this week has a story about a former in-house counsel at Toyota who has alleged in a lawsuit that the company hindered his investigations related to rollover lawsuits from 2004 to 2007, altered some of his findings or destroyed evidence all together. Pretty serious stuff.

Toyota has filed a motion with the U.S. District Court in Los Angeles, where the suit was filed, to have the documents sealed. For now, though, they are a part of the public record, and there is some pretty inflammatory language coming from the plaintiff, who once was the architect of Toyota’s defense of the thousands of rollover claims.

In other Toyota litigation news, the Prius Hybrid, which is scheduled for production in Blue Springs at some point, is the star of a lawsuit Paice LLC filed against Toyota. It focuses on the the hybrid technology itself. This isn’t the first time Paice and Toyota have engaged in legal warfare. The two share an extensive history.

Also, Gov. Haley Barbour will hold a symposium focusing on healthcare and energy and will also unveil an initiative aimed at helping small businesses tomorrow afternoon at the Jackson Convention Complex. Staff writer Nash Nunnery will be there to provide coverage for the MBJ.

Categories: Haley Barbour, News, Politics, Toyota Tags:

Toyota slashing production

August 26th, 2009 3 comments

And a good Wednesday morning to all. The college football season kicks off in eight — eight! — days. That’s a week and a day. Take out the weekend, and really it’s only six days. Magnolia Marketplace is boldly going out on a limb and declaring that football season will be here in less than a week. Spread the word.

On to not-so-happy news. Toyota has confirmed rumors that started popping up yesterday that it plans to cut worldwide production by about 10 percent. With sales slumping, the company has a production surplus and will idle plants in the U.S. and overseas. Best I can tell, the only American facility affected is the one in Northern California Toyota once shared with General Motors. It will close, which is no big surprise because the move had been rumored for weeks.

How does this affect Mississippi? Well, it probably does nothing to speed the process of opening the Prius Hybrid (or whatever is hopefully, maybe, eventually built there) plant in Blue Springs. It doesn’t make any sense to slash global production by a significant number and open a new facility at the same time.

Mississippi’s other automotive manufacturer has news of its own. Nissan is retrofitting about 60 of its “tugs” at its Smyrna, Tenn., plant with methanol fuel cells. The tugs, which look like mini forklifts, shuttle parts and materials from one part of the facility to another. The fuel cells replace regular batteries, are more energy efficient and require fewer man hours to replace. Details are here. Smyrna is the guinea pig for this technology. The release doesn’t mention anything about the Canton plant. I have a call in to a Nissan North America spokesman to see if this technology will eventually make its way down here. When I hear from him, I’ll post an update.

Updated at 11:20 a.m. : Just got off the phone with a Nissan spokesman, who said the methanol fuel cells will undergo a three-year trial run in Smyrna to gauge their viability. If the company is pleased with the results, there is a possibility the technology will expand into other facilities, including the Canton plant.

Categories: Manufacturing, News, Nissan, Toyota Tags: