Editor’s Note: The following is CityScrapes, a column of opinion and analysis.
The project was dubbed “Project Starbright,” as in “Star light, star bright… I wish I may, I wish I might have the wish I wish tonight.”
The effort of which I speak, of course, was the one to lure Toyota’s new Tundra pickup plant to San Antonio, bolstered by ample public subsidies. The Japanese automaker’s announcement last month of an additional $391 million investment in that South Side plant makes it a good time to ask how that wish has worked out.
When Toyota’s commitment to San Antonio was announced in early 2003, the manufacturing firm planned for initial employment of 2,000, and the production of 150,000 Tundras annually. Then-councilman Julián Castro said the new plant “should stimulate more economic development for the city than anything seen in the past 20 or 30 years.” But the far grander promise for all of the state, county and city subsidies granted to Toyota was that if Tundra sales worked out as anticipated, the plant could see a second phase, boosting truck production and bringing total employment to 4,300.
Things didn’t quite work out that way.
First, the Tundra didn’t take off in the market. After the first trucks came off the production line in late 2006, Toyota sold around 196,000 Tundras the following year. But 2008 sales dropped to 137,250, and then to just over 79,000 in 2009 as the entire auto industry suffered from the Great Recession. The Ford F-series pickup sales, for example, dropped from 796,000 in 2006 and 690,000 in 2007 to just 413,625 in 2009.
However, the Ford pickups soon came roaring back, with sales of 763,000 in 2013 and almost 821,000 in 2016. For 2018, the F-series sales totaled 909,330.
The Tundra has had a sharply different performance in the marketplace. From 2009 sales of 79,385, the Toyota pickup climbed back to 112,700 in 2013 and hit 118,493 in 2014. And then they stalled. The 2018 sales total was just 118,258.
Simply put, the Tundra sales now are still not at the 150,000 a year expected in the 2003 announcement of the San Antonio plant.
What has “saved” the San Antonio plant is production of the mid-sized Tacoma pickup, shifted here in 2010 when the joint Toyota-General Motors plant in California was shuttered. The Tacoma has proven far more viable in the market, with sales growing in recent years from 155,000 in 2014 to over 245,500 in 2018.
But that relative success does not translate into an expansion of jobs or production in San Antonio. Toyota has chosen to hedge its bets on building Tacomas, with a production line at its Tijuana plant and at a new plant in Guanajuato.
The recently announced $391 million investment in San Antonio, accompanied by a 10-year tax abatement? It’s for additional robotics and “cobots” as part of a new platform for the pickups. It won’t mean any new jobs or added production.
The prospects of that promised “second phase” for the San Antonio plant that would yield 4,300 total jobs look seriously unlikely. The “wishes” on the star don’t always come true — not fully, anyway. And when, in August 2017, Mayor Nirenberg and Judge Wolff announced a bid to win a new Toyota-Mazda joint plant with a promised investment of $1.6 billion, that too came up short. That new plant is now being built in Huntsville, Alabama.
Toyota has certainly brought something to this community. But it joins a long list of tax-abated and subsidized projects, from Golden Aluminum and the American Airlines reservation center to AT&T and Sony Microelectronics, that haven’t fully delivered or have simply closed up shop and left.
Heywood Sanders is a professor of public policy at the University of Texas at San Antonio.
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