Toyota's North American CEO Jim Lentz has already given us a rough idea of what prompted the company's surprise move to the Dallas suburb of Plano, TX from its longstanding headquarters in Torrance, CA. A new story from The Los Angeles Times, though, delivers even more detail from Lentz on the reasoning for the move, what other cities were considered and why the company's current host city wasn't even in the running.

Of course, one of the more popular reasons being bandied about includes the $40 million Texas was set to give the company for the move, as well as the state's generous tax rates. According to Lentz, though, the reason Toyota chose Plano over a group of finalists made up of Atlanta, Charlotte and Denver, was far simpler than that – it was about consolidating its marketing, sales, engineering and production teams in a region that's closer to the company's seat of manufacturing in the south.

"It doesn't make sense to have oversight of manufacturing 2,000 miles away from where the cars were made," Lentz told The Times. "Geography is the reason not to have our headquarters in California."

Geography isn't the only reason, though. Toyota is aiming for a more harmonious coming together of its far-flung and disparate divisions, which is something that couldn't be provided by moving everyone to Torrance. "We needed a neutral site," Lentz said, pointing out that moving engineering employees based in Kentucky to Torrance could give the impression that "sales was taking over."

Lentz said a conversation with Global President Akio Toyoda kick started the idea of moving, as the company sought to organize its North American business "for the next 50 years."

As for why Plano won, there are a number of reasons, one of which was the area's cost of living. According to The Times, the average house in the LA area costs $515,000 – in Dallas, it's less than half that, at $217,500. Toyota also considered the climate, access to direct flights to Japan (Plano is served by the sprawling Dallas/Fort Worth International Airport) and the quality of the area's schools as factors behind Plano's victory.

There's more on the aftermath of the move as it relates to the State of California over on The Los Angeles Times website. Hop over and take a look.


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  • 58 Comments
      Racerman967
      • 7 Months Ago
      Wow, I guess some folks can't come to the realization that California is a bad state to do business in. If it wasn't so many companies wouldn't be leaving. And even ones based there)Carl's Jr/Hardee's) have stated that will not open any more locations in California. Taxes bureaucracy, high cost of living. I was born and raised there and lived for 37 years and had to leave for Denver 10 years ago. Just refused to pay 600k for a basic house. Business is about profit for shareholders. If employees don't want to move that is there right and I can respect that. They need to do what is best for their families.
        lasertekk
        • 7 Months Ago
        @Racerman967
        Fifty some years ago, Japanese companies decided they needed to be near the ports of LA and Long Beach,the primary entry points for goods coming into the US, in addition to having access to the huge market that is California. Today, Chinese companies are setting up shop in California under the same pretense. So Toyota may leave, but new opportunities are arriving from the 'new' Japan.
      Howard
      • 7 Months Ago
      The LA Times article was lame. They asked why the move and Toyota says (in part) they want to be closer to manufacturing. What LA TImes didn't do is follow-up on that question. WHy is manufacturing LESS expensive in Texas then SoCal? Truth is, no matter how much lipstick you want to put on that pig, it's EXPENSIVE to do business in California (SoCal). It's EXPENSIVE to live and raise a family in SoCal. Whether an individual or a business, the taxes will kill the honest guy. Toyota will eventually move all staff OUT of SoCal into Texas.
      Ray
      • 7 Months Ago
      Not 1 person worked at Toyota and lived in Torrence... Heck 90% lived in the OC and commuted 2 hours/day. Plano is awesome by far the best area I've lived in/near. Nicest people, best markets - you can't beat Central Market! Zero state taxes. The CA "lifestyle": Pay ridiculous taxes, commute 2 hrs/day, no time for the beaches that were covered in tar!!!! By far the worst traffic EVER.
        Truque Johanssen
        • 1 Month Ago
        @Ray

        While I agree with the overall sentiment, "zero state taxes" is incorrect.  While the income tax rate is zero, property taxes are relatively high.  According to an LA Times article, the rate in Torrance is $1.07/$100 valuation.  Per the Collin County Appraisal District website it's $2.25/$100 in Plano (includes City, County, school district, and community college district).


      Ferris Macau
      • 7 Months Ago
      I've lived in Torrance and Dallas so I know both areas intimately well. If any Toyota employees are wondering... Plano is NICE and hell of a lot better than Torrance. Main difference is weather obviously, it's much hotter, colder and always windy. A grown up adult will accept and move on because it's no big deal you get used to it after a full 4 seasons. The second main difference is cost of living. There is no state income tax, houses cost half, and gas is 75cents cheaper, Given the same salary, the reloed CA worker will have NO money concerns, you can afford anything, easy living. Otherwise everything else same, restaruants, malls, banks... Texans are ok, there are lots of latinos obviously.
      scott3
      • 7 Months Ago
      This is a wake up call to all the states that are not business friendly and often are too over burdened with social programs and public unions that literally tax the system to death. We live in a country built on free enterprise and it has slowly eroded away in part of the country. These areas have taken personal responsibility away from the individual and has tried to give the people state assistance that was originally meant to help them get back on their feet to keeping them on the state rolls. What better way to drive votes than if you are on the public dole or if you are in a state union where you can vote your own raises in. Some states get it and have been prospering while others cities and states do not get it and have been going bankrupt. Just look at Detroit and how it was run into the ground. Even if the automakers had not had issues the city unions and state programs were more than the people their could be taxed for. Now as it is what company in their right mind would want to move there unless they are given an incentive. The strongest way to a prosperous economy is to create long term jobs in great numbers and create an environment to where a company can hire people that want to work and still make money to satisfy the share holders of the company with return on their investment as well as investment in the company to grow the business. I know those who love the social programs hate this thinking but the fact is this country was build on capitalism and initiative in the private sector. Just look at where Russia is at and how so few prospered under a social program. China now is trying to do a semi capital and semi socialist industry and while it is working because they have a large number of people with nothing for now it can turn on them very quick if it gets out of hand. While some take this as a personal attack on California and other states that are democratic social program heavy it is not. It is simply a fundamental this country was build on to start with. Americans were always in search of a better place with less government control to live parts of our lives. We left Europe and else where for it we drove to California to keep it and now we have to double back to retain it. A fiscally responsible government will always beat one that is not. Here is the proof. While you many not like to hear it, The truth is a incontrovertible. Malice may attack it and ignorance may dried it, but in the end, it is still there.
        what
        • 7 Months Ago
        @scott3
        Ignoring your infantile understanding of economics, what part of West, Texas, demonstrates personal responsibility?
          scott3
          • 7 Months Ago
          @what
          I will give you an hint. It is the one already filled with several defaulted democratic cities with more on the way.
        Tom
        • 7 Months Ago
        @scott3
        What you don't seem to realize is Texas is giving Toyota 40 million dollars of taxpayer's money! That's about $10,000.00 per job and no Texas is not giving anything to the employee. When you pay for job creation with taxpayer money, its just another form of welfare.
          scott3
          • 7 Months Ago
          @Tom
          Tom what you fail to realize is that the money given just the direct jobs created but the related industries and services that are needed to support these companies brought in. The effects are much more far reaching than many will want you to believe. On the other hand you lose one company or job and it is gone as is anything that company and person spent to live, work and play in that area. Living here in the Midwest Rust Belt we learned the hard way and know how it really works. Even the Democrats here have learned you give a little get a lot. This is not the same thing as welfare as there is a return on this unlike welfare if it is done right. Goodyear brokered a deal here with the City of Akron and it has locked Goodyear and all their jobs in for 50 years. We have already lost BFG, and much of Firestone with devastating loss. If we had lost Goodyear the largest area employer out side the government it would have been a mess. We can not just make it on service jobs an government jobs only.
      MrMonkaroo
      • 7 Months Ago
      I am so sick of hearing all the liberal people talk about how it's bad to give incentives for business to move to another state. I can't think of one liberal city/state that is actually doing well in America right now. They have high taxes, ridiculous regulations, and cost of living in general is much higher. Who wants to give almost 50 percent of their income to the federal and state governments?
        Adam Murrell
        • 7 Months Ago
        @MrMonkaroo
        You're absolutely right, and their snooty too!
        dude
        • 7 Months Ago
        @MrMonkaroo
        elite liberals in NYC and LA are the first to act like theyre all for the good of the people but will be quick to ignore or find a homeless person disgusting and vulgar.....
      • 7 Months Ago
      Over 1,000 Toyota employees will be asked to relocate from N.Kentucky to Plano. So when Jim Lentz says "According to The Times, the average house in the LA area costs $515,000 – in Dallas, it's less than half that, at $217,500" that's great for the CA employees the GET TO KEEP THEIR CA SALARIES with a 26% cost of living DECREASE, but sucks for the others that get an 8% cost of living INCREASE (median house price in N.Ky is $118,750) and have to keep there KY salaries. Hardly the recipe for a harmonious meeting of multiple divisions when you have people working together doing the same job for 34% more compensation $$.
        engr00
        • 7 Months Ago
        You think you get paid more in CA ? XXXXXXXXXXXXXX Wrong. Same salary for my position here as in MI. Do some research before you spew.
      Charlene Blake
      • 3 Months Ago

      Toyota and Lexus are #1 in cases of sudden unintended acceleration and FORD is #2. The current unintended acceleration plaguing newer vehicles is the electronically-induced type. The engine throttle control systems depend on computer software to command them. Sometimes glitches occur...like in some of your other electronic devices...which can cause the command to be different than what you desire. The evidence of the glitch is often undetectable after the vehicle is restarted. Unfortunately, the EDR (black box) is not always accurate as shown by expert Dr. Antony Anderson in his analysis of a 2012 Toyota Highlander. The EDR results indicated the driver was not braking when she was doing so. The EDR results are inconsistent.

      The key to avoiding a horrific crash during a SUA event is whether or not the vehicle has an effective fail-safe in the event a glitch occurs. If it does not, as in the case of the glitch-prone Toyota ETCS-i, then the vehicle may become a runaway with an ineffective means to stop it. Unfortunately, the safety standards aren't as strict in automobiles as they are in airplanes. Some manufacturers have more effective fail-safes than others. In the case of Toyota, an embedded software expert, Michael Barr (see Oklahoma Bookout vs. Toyota court case involving a 2005 Camry) found that an electronic glitch could induce a SUA event. Another expert, Dr. Henning Leidecker, found that a SUA event could also be triggered by "tin whisker" formation, particularly in 2002-2006 Toyota Camry vehicles. 

      SUA events have been DEADLY for vehicle occupants as well as pedestrians and people in storefronts, buildings, and even homes. The numbers of such crashes are ever-increasing with the advent of the very complex ELECTRONIC throttle control systems. 

      With the increase in such serious vehicle crashes, there is a concerted effort to show driver "pedal misapplication" or a "medical condition" or some other reason for the incident...anything other than a vehicle defect. Investigators aren't scrutinizing the buggy electronic throttle control software or other conditions that can elicit a terrifying sudden unintended acceleration incident. They usually just examine the *mechanical* causes which tend to be just red herrings in these cases. Investigators simply don't have the expertise to find such electronic glitches. In fact, the staff at the NHTSA, National Highway Traffic Safety Administration, do not have this very specialized training!

      Think of it...the next step in electronically-controlled vehicles seems to be so-called "self-driving cars." Do YOU want to be in a such a vehicle when there is no evidence that strict safety standards, particularly in the throttle control system's software, have been adhered to? Will you just BLINDLY trust the automaker (criminally-investigated and nearly-prosecuted Toyota and soon-to-be GM and others?) to come through for you and your family's safety *on its own*? 

      A recently published Huffington Post article by Jonathan Handel, 

      How Do We Know Driverless Cars Are Safe? Google Says 'Trust Us' Posted: 07/01/2014 7:23 pm EDT Updated: 07/02/2014 1:48 pm EDT speaks to these very issues and poses tough questions about Google's "driverless" vehicles. Educate yourself carefully before you put your faith in automakers who have knowingly lied to their customers and the government for decades. Study the issue of vehicle electronic sudden unintended acceleration and ask WHY we aren't seeing it addressed publicly. WHY is blame placed on the driver with little more than speculation about which pedal was used or with little more than an assumption on medical condition. This is being done *even when the drivers steadfastly cite a VEHICLE PROBLEM as the cause of the crash. Absence of proof is not proof of absence of a serious ELECTRONIC computer glitch or other electronically-caused SUA. 



      Charlene Blake

      thequebecerinfrance
      • 7 Months Ago
      Wow, housing is very cheap in Dallas. I thought it was one the expensive in the US, guess I was wrong.
        Sanchez
        • 7 Months Ago
        @thequebecerinfrance
        The Dallas area remains quite affordable due to endless construction and supply of land. Of course, one can pay a lot more: Plano itself has some of the highest-priced newer housing and the "Park Cities" are the old money area around SMU. Regardless, Toyota people will live all over the Dallas area. As long as you're not married to living near the Coast and don't mind a mild version of four seasons of weather, it's a great place to live. Contrary to some beliefs shown here, Dallas is big and open enough to appeal to various ethnic and lifestyle backgrounds. I lived around Dallas for several years and now live in Orange County, CA (where a lot of Toyota people actually live, rather than Torrance) and have enjoyed both.
      John
      • 7 Months Ago
      The "climate" consideration has to make me chuckle, as DFW has now become prone to blistering 100-degree + summers as well as its traditional ice storm winters, which happen every year, but no one has ever seemed to learn to drive in without smashing everything in sight. While it may be somewhat preferable to the volume of snow Denver receives from a purely business standpoint, it is going to be a major, major shock for employees accustomed to the eternally pleasant Torrance weather.
        RGiddyUp
        • 7 Months Ago
        @John
        And Plano's schools...that on it's own gave me a belly laugh. Everybody just knows how Texas is just "filled to the brim" with mental giants. LOL
          T. C.
          • 7 Months Ago
          @RGiddyUp
          HEY!! I got relatives teaching in Texas and... well... I couldn't agree with you more.
      tump
      • 7 Months Ago
      So if you're working in Torrance and they offer to move you to Texas, reconsider the offer - unless you really want to go live in a [comparitive] cultural wasteland that has perfected boredom. -ex-Texan
        JayP
        • 7 Months Ago
        @tump
        Wow. As a car enthusiast, I have to defend DFW. This weekend we have Cars and Coffee Dallas Hosted by Classic BMW in Plano. Sunday is the annual All British (and European) Cars show at White Rock Lake. We have several tracks- Texas Motor Speedway is about 45 minutes away from Plano. We're only a few hours away from The GP of Houston. COTA is a straight shot to Austin. Yes, an F1 event. Want to drive? SCCA, NASA, HPDEs out the ears. Every weekend is an event. Motorsport Ranch. Harris Hill, Eagles Canyon. MSR Houston. Hallett in OK. Like vintage racing? We have it. Like Imports? local dealers sponsor track events. Drags? There's several 1/8 tracks close and one NHRA track about 30 min from Dallas. Like to wax the car? There's a car show every weekend somewhere. GoodGuys twice a year. Optima had the Supercar Challenge at TWS last month. Yea, Dallas has the fancy concert halls, ballets, museums, So does Fort Worth. I've been tricked into seeing Lalique pieces and some play with a female nude scene. (Can't remember the play, just the scene.) And we have that local stuff like BBQ. More breweries than I can drink. And we have attractive women. I think I just made a case to myself to hang around another 20 years.
          i_heart_2_pwn_u
          • 7 Months Ago
          @JayP
          average dallas resident couldn't afford to live in torrance so not like it's even a choice for most. and your "attractive" chicks are fat.
        tump
        • 7 Months Ago
        @tump
        I guess the Japanese executives were won over by golf and strip mall sushi.
      icemilkcoffee
      • 7 Months Ago
      $40 million welfare check to Toyota. Glad to see republicans embracing welfare finally.
        bootsnchaps60
        • 7 Months Ago
        @icemilkcoffee
        Pastor Perry probably threw in a tip of his ten gallon hat. Probably no one offered as much of an incetive.
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