New United Motor Manufacturing, Inc. (NUMMI) was an American automobile manufacturing company in Fremont, California, jointly owned by General Motors and Toyota, that opened in 1984 and closed in April 2010. The plant is located in the East Industrial area of Fremont next to the Mud Slough between Interstate 880 and Interstate 680. The plant's peak production year was 2006, when it manufactured 428,633 vehicles.

After the plant was closed by its owners, the facility was sold to Tesla and reopened in October 2010, becoming known as the Tesla Fremont Factory.

History

Background

Before NUMMI, the site was the former Fremont Assembly that General Motors operated between 1962 and 1982. Employees at the Fremont plant were "considered the worst workforce in the automobile industry in the United States," according to a later recounting by a leader of the workers' own union, the United Auto Workers (UAW).

GM as a company was departmentalized (design, manufacturing) as per Henry Ford's division of labor, but without the necessary communication and collaboration between the departments. There was an adversarial relationship between workers and plant supervisors, with management not considering the employees' view on production, and quantity was preferred over quality. Like all American car plants, the production lines at Fremont seldom stopped, and when mistakes were made, cars continued down the line with the expectation that they would be fixed later. For Toyota, the factory gave the company its first manufacturing base in North America allowing it to avoid tariffs on imported vehicles and saw GM as a partner that could show them how to navigate the American labor environment, particularly relations with the United Auto Workers union.

Ahead of the reopening of the plant, Toyota sent many of the workers to Toyota's Takaoka plant in Japan Once in the United States, Toyota Auto Body California (TABC) would produce the truck beds and attach them to the trucks. TABC was the first manufacturing investment in the U.S. for Toyota. This tariff loophole was closed in 1980.

NUMMI did face some financial challenges, with cars costing more to build than at other GM plants and only operating at 58.6% capacity by 1988. The plant had not reached break-even by 1991. Production reached its annual peak of 428,633 units in 2006.

The end of the joint venture

Toyota took the lessons it learned from NUMMI and went on to establish the wholly owned Toyota Motor Manufacturing USA (later renamed Toyota Motor Manufacturing Kentucky) and Toyota Motor Manufacturing Canada plants in 1986, and by 2009 the company was operating a dozen manufacturing facilities in North America. However, NUMMI remained Toyota's only unionized plant in the United States.

GM executives, particularly CEO John F. Smith Jr., attempted to spread the Toyota Production System to other assembly plants, but it proved largely unsuccessful. Despite having a front row seat to learn about the production system, by 1998 (15 years later) GM had still not been able to implement lean manufacturing in the rest of the United States, though GM managers trained at NUMMI were successful in introducing the approach to its unionized factories in Brazil.

By 2009, GM was in serious financial trouble and filed for Chapter 11 bankruptcy reorganization. In April the company confirmed its commitment to NUMMI and in June announced that it was scrapping the Pontiac brand which would end production of the Corolla-derived Pontiac Vibe at NUMMI by August 2009. That triggered several months of discussions between the automakers, trying to find products that could be produced at the factory for both companies, with Toyota even offering to build a version of its Prius hybrid for GM at the factory.

Fremont Mayor Bob Wasserman, city officials and California Governor Arnold Schwarzenegger lobbied the automakers to find a product and keep NUMMI open. State officials crafted sales tax exemption on new factory equipment to preserve NUMMI. A regional committee was formed in February 2010 to investigate the closure of the plant, and the facility was appraised while operating.

The talks ultimately failed and in June 2009 the GM announced that it would pull out of NUMMI. On August 27, 2009, Toyota announced that it would also discontinue production at NUMMI by March 2010, marking the first time the company had ever closed a factory.

In a November 2009 call with autoworkers, Toyota's head of U.S. sales said that though it was a difficult decision to shut down the plant, "the economics of having a plant in California so far away from the supplier lines" in the Midwest "just doesn't make business sense" for Toyota. Autoworkers prepared for the shut down by refreshing skills and planning for career transitions. In March 2010, 90% of the workers at the plant approved a $281 million severance package from Toyota that had been negotiated by the UAW, averaging $54,000 to the plant's 4,700 employees.

Production of the Corolla in North America was shifted to Toyota Motor Manufacturing Canada until the new Toyota Motor Manufacturing Mississippi assembly plant could open in October 2011. Production of the Tacoma had already partially shifted to Toyota Motor Manufacturing de Baja California in 2004, and the remaining work shifted to Toyota Motor Manufacturing Texas. NUMMI sold off equipment at an auction, and Mississippi. NUMMI sold some equipment to Tesla for $15 million.

Reuse of the factory

Ahead of the closure of NUMMI, several possible uses for the facility were proposed.

In January 2010, the land was considered for a new stadium for the Oakland Athletics of Major League Baseball. It is close to the proposed site of Cisco Field, which was never formally approved. On March 10, 2010, Aurica Motors announced that it intended to raise investment capital and garner federal economic stimulus funds to help retrain the workers and retool the facility for production of electric vehicles. Both proposals went nowhere.

On May 20, 2010, Tesla Motors announced that it would purchase most (210 of 370 acres) As part of the agreement, Toyota would also purchase $50 million of common stock when Tesla held its IPO the next month. In exchange, Tesla agreed to partner with Toyota on the "development of electric vehicles, parts, and production system and engineering support." The two companies would later end their partnership in 2017.

The plant, renamed the Tesla Fremont Factory, produces the Model S, Model X, Model 3, and Model Y vehicles. , the plant employs 22,000 people, far greater than the 5,500 employees of NUMMI, and produced nearly 560,000 vehicles, 30 percent more than the maximum output of NUMMI.

Models produced

During its time in operation, the NUMMI joint venture factory produced the following models (model years):

References

  • Autointell NUMMI page
  • Photo Tour of NUMMI from Edmunds.com
  • JD Power Gold Plant Award for GM
  • NUMMI (2015) from This American Life
  • NUMMI production over the years <!-- from

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