Note to LAX: Losing Toyota Is on You - Get a Real Hub
LOS ANGELES ( TheStreet) -- Do we really think low taxes and a salesman governor are enough to convince Toyota
Sure, that's the story line. And of course, companies will do pretty much anything to pay lower taxes. But another equally important consideration is transporation infrastructure, which has driven corporate relocation decisions for centuries.
In this case, Los Angeles does not have a real airline hub and Dallas/Fort Worth does. That's important for a sprawling global corporation with manufacturing plants and other facilities throughout the U.S and the world.
The big three U.S. airlines all claim to operate hubs at LAX, but that is just nomenclature. United
By contrast, the American
In the U.S., transportation infrastructure has dictated corporate relocations since the Pilgrims arrived in Plymouth, Mass., in 1620, an early indication of the importance of East Coast harbors. Early business centers were Boston, New York, Philadelphia and Charleston, S.C. A high-capacity port made Charleston the fifth-largest U.S. city in 1690 and Boeing's
In the U.S., Toyota has manufacturing plants in Georgetown, Ky.; Tupelo, Miss.; Huntsville, Ala.; Princeton, Ind.; Buffalo, W. Va.; and San Antonio, Texas. The closest major airports to each plant, respectively, are in Lexington, Ky.; Memphis; Huntsville; Louisville, Ky.; Charleston, W. Va., and San Antonio.
Only Memphis and San Antonio have non-stop service from Los Angeles, and it is not frequent. But all six airports have non-stop service from DFW.
"We carefully evaluated a wide range of factors before selecting Plano, which included economic considerations, geography and climate, transportation, the cost of living and educational opportunities, among others," said Toyota spokeswoman Carly Schaffner.
"With manufacturing locations in many U.S. states, Canada and Mexico, we chose a location that better supports our diverse geographic footprint, in a time zone that allows us to communicate better with most of our operations, and has direct flights to all our operations," she said.
Could LAX possibly work with a major airline to establish a hub that would provide connections throughout the country?
On the plus side, American desperately needs a West Coast hub, and Los Angeles is easily the best possible site. United already has a West Coast hub in San Francisco and Delta is busily establishing one in Seattle. American has its New York hub in Philadelphia and its West Coast hub in Phoenix.