Toyota Reviews Mexico Plant Timing

Toyota Motor Corp. President Akio Toyoda has ordered the company to reexamine plans to build an auto plant in Mexico, Reuters reports.

Sources tell the news service Toyoda is likely to eventually approve the small-car plant, but not until he is convinced the carmaker lacks existing capacity elsewhere in North America.

Planners had expected to decide on the factory this summer. Now they say a decision isn't likely until early next year.

Toyota is one of few carmakers with no local carmaking capacity in Mexico. But President Toyoda is adamant about not repeating the mistakes of his predecessors, who added capacity to fuel growth rather than allowing demand to define appropriate capacity.

Toyoda declared a three-year freeze on new factories between 2013 and 2016. But Reuters says other executives believe rebounding demand and rising company profitability indicate the timing is right to launch the factory project now.