Report: Toyota May Retain Only 30 Percent of Employees during Texas Move (UPDATED)

Nov 17, 2014 02:15 PM EST | Jordan Ecarma

Toyota's shift from southern California headquarters to new digs near Dallas, Texas, could reduce its workforce by as much as 70 percent, a source familiar with the matter told Automotive News.

The automaker, which has a corporate atmosphere that encourages employees to stay long-term, is offering a lump sum to help persuade workers to move with the company.

Employees who agree to stay in Plano, Texas, for two years "will be provided with a generous retention package that will recognize and reward the value of their much-needed talents through our years-long transition," Toyota spokesman Steven Curtis wrote in an email quoted by Automotive News.

The Japanese carmaker's North American arm has budgeted to keep 50 percent of its workforce during the transition to new headquarters, but officials reportedly fear that it will only retain around 30 percent.

"They would be happy to have 50 percent," an internal source who asked not to be identified told AN. "It's hard to tell [how many people will go] because nobody has been offered their jobs yet."

Toyota intends to consolidate its scattered operations at the new Dallas location, bringing together its engineering, sales, marketing, finance and corporate divisions in one place during the next few years.

As part of the campaign to make Texas more appealing, Toyota has paid for three-day trips to Plano that put employees in one of the area's best hotels. The company also has a list of "99 Things about North Texas" on its internal website, touting the area's fried pickles, historic sites and downtown attractions.

The company announced the move in April and over the summer said that it planned to rewrite all job descriptions as part of a companywide restructuring process. Previously, company culture and standards have been different for each division, making paychecks and promotions inconsistent throughout the company.

"This is a way in one fell swoop to rejuvenate human resources," a former Toyota executive told Automotive News. "You're going to lose some good people but overall you're going to have a better atmosphere."

Eventually, the shift will consolidate Toyota's North American operations, which comprise 2,000 positions at Toyota Motor Sales U.S.A. and 1,000 positions at Toyota Financial Services in Torrance, Calif.; 1,000 positions at Toyota Motor Engineering & Manufacturing North America in Erlanger, Ky.; and about 50 positions at Toyota Motor North America in New York.

"We haven't yet asked our team members and associates to commit to their future with us--we want to give them plenty of time to assess their options, visit Texas and plan with their families as they make this very important decision," Toyota said in a statement provided to AutoWorldNews. "But the feedback we've gotten so far from their visits has been very positive, and we are hopeful that many of our employees will choose to make the move with us here." 

UPDATED: 9:58 a.m. 11/21/14

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