Flagging Lexus sales force Toyota to axe 800 workers

Earlier this week reports emerged citing an announcement made by Toyota that it was cutting up to 800 jobs at one of its plants in Japan. The decision was made in response to declining sales of SUV models in North America, in particular the Lexus RX mid-size SUV, which the plant is responsible for.

Lexus has been hit much harder by America’s auto sales slump than Toyota, with U.S. sales falling 25% in July compared with levels from just one year ago. Growth in demand for Lexus models has rarely faltered since Toyota introduced the brand back in 1989, and this was the first time that Toyota Motor Kyushu – a subsidiary responsible for building the Lexus vehicles – had to make large scale redundancies since it began operations in 1992, reports the Financial Times.

Production numbers at the plant are expected to be reduced by about 10% this year, down to roughly 400,000 vehicles. However, Toyota hopes to lift this and re-hire about 500 workers later in the year. Some of the models the plant is responsible for include the RX350 and RX400 SUVs, both petrol and hybrid versions, as well as the Lexus IS and ES sedans and Toyota Highlander.

Last week, Toyota cut its 2008 global sales forecast by 350,000 units to 9.5 million vehicles, citing a poor U.S. economy, record oil prices and rising material costs.