SAN ANTONIO, TX — The JLC cattle ranch, established in 1794, will never be the same.
Stretching over 2,000 acres on barren plain 15 miles south of downtown San Antonio, the old ranch by 2006 will begin production as Toyota Motor Corp.'s sixth North American assembly plant.
It will produce Tundra fullsize pickups at a clip of 150,000 annually, deep in the heart of the Big Three's most treasured truck markets. San Antonio also is home to the historic Alamo mission-fort, site of a famous 1836 battle to the end.
Taking on the Big Three in Texas is in-your-face hardball, but this time the Americans aren't likely to relinquish ground without a serious battle. “Bring ‘em on,” smiles Cheryl Fodera, controller at Southway Ford, a few miles from the sprawling Toyota site.
In 2002, Toyota sold 99,333 Tundras in the U.S., down from 108,863 in 2001. GM sold 647,748 Chevrolet Silverados and 200,146 GMC Sierra fullsize pickups while Ford sold 813,701 F-Series models and Chrysler delivered 396,934 Ram pickups, according to Ward's data.
That's a huge 2 millon-per-year fullsize-pickup market — 13.2% of total U.S. light vehicles in 2002 — making it too tantalizing to resist. Nissan Motor Co. Ltd. also will stake a claim when its Titan big pickup starts production in a new Canton, MS, plant in 2005.
The Big Three have some new firepower. American pickup buyers are a loyal bunch, and Ford, the perennial sales champion, will launch an all-new F-Series this summer. Dodge did a Ram makeover a year ago, and GM's large pickups, redone in 1998, have been upgraded recently and likely will be significantly revamped before Tundras roll off the line here three years hence.
Toyota's 150,000 units planned initially for San Antonio production may be just the beginning. There's already talk of expanding the plant to include spinoffs. There remains 600 more acres on the old ranch if it's needed.
Infrastructure work is under way, and companies that currently supply Toyota's Princeton, IN, plant where Tundras have been built since 1999 are developing logistics strategies.
Toyota will invest $800 million in the plant, but it will have a far greater economic impact. Ward's has cited studies indicating the plant could generate $1.8 billion in investments by suppliers and others, creating 16,000 jobs and $962 million in wages, although clearly not all in the San Antonio area.
“It's huge,” says Laura Lorek, a reporter for the San Antonio Express-News who has covered the Toyota story. “It's one of the biggest windfalls in our history.”
South side auto dealers say they welcome the newcomers.
W.P. (Bill) Sims Jr., customer relations manager and son of the owner of Southway Ford located on an automotive row alongside I-35, observes: “I think it's going to be great. Toyota will pump money into the area and give us an opportunity to sell more cars and trucks.”
One of the largest Ford dealers in Texas — and the U.S. — Southway sold 3,600 new vehicles, including 2,538 trucks and SUVs, last year, says Sims.
“They're coming right in Ford's backyard, and they've thrown down a challenge,” says Sims. “They say they're ready, so we say we're ready, too. We've seen the new F-Series, and we love it. We'll see more Tundras around here, but we think it's going to be great.”
That sentiment is echoed by Frank Cortez, finance and insurance manager at Vara Chevrolet, whose motto is “When you come to Vara, you've come to the Heart of Texas.”
Says Cortez: “People at Toyota and the other companies (suppliers) are going to spread around their dollars, and that will trickle down to the local merchants like JC Penney and McDonald's. It's possible they'll come in and give us some business.”
Vara sells 1,000 Silverados annually, says Cortez, adding that Chevy has attributes Tundra won't match in the early going, including special derivatives and more spacious interiors. “I welcome them all — Toyota, Nissan, whoever. They can't match our Silverado.”