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Toyota offers exit plan for some workers

By Ben Rooney, staff reporter


NEW YORK (CNNMoney) -- Toyota confirmed Tuesday that it is offering "voluntary exit packages" to certain employees in California as part of a restructuring plan.

The move comes after the weak economy and last year's massive recalls tarnished Toyota's reputation and took sharp a toll on sales.

The exit packages, available to managers in the operations group and customer service division at Toyota headquarters in Torrance, Calif., are "part of an ongoing process of evaluating our operations and aligning them with our future growth," the automaker said in a statement.

"It will allow for further restructuring and enable us to expand areas of responsibility and increase efficiency," according to Toyota.

There is no specific target for how many employees Toyota expects will take advantage of the program, and Toyota stressed that employees are not required to participate.

Toyota said it will offer eligible employees a "transition assistance payment" of $20,000. The packages also include a payment equal to two weeks salary for each year of service, and a check worth 10 weeks of salary.

"I want to emphasize that this is a voluntary package and a very generous package at that," said Toyota spokesman Steve Curtis.

Employees have until March 1st to decide if they want to take the offer. Those who choose to participate will leave the company by April 28, according to the plan.

Earlier Tuesday, Toyota said sales rose nearly 24% in January from the year before, when the Japanese automaker had suspended production of many vehicles due to recalls.

The gain in January, which reflects Toyota's poor performance a year ago, came after sales fell 6% in December. Toyota, which lost market share last year for the first time in over a decade, was the laggard among the major automakers in 2010.

But Toyota is "very optimistic about the future," according to Curtis.

David Cole, chairman of the Center for Automotive Research, said offering employees exit packages is very common in the auto industry, and that he expects overall hiring to increase this year.

Cole said the packages are part of an effort to ensure that Toyota has the right employees in the right locations, and are probably no part of a larger plan to shrink headcount.

"They're trying to rebalance, and like everybody else, buyouts are a part of that," he said. To top of page

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