Final answer:
Toyota faced risks related to compliance with U.S. manufacturing content requirements when it opened plants in the U.S., which included adapting to local supply chains, labor markets, and just in time delivery systems.
Step-by-step explanation:
When Toyota Motor Company built automobile manufacturing plants in Tennessee and Ohio, it faced economic risks associated with compliance with U.S. domestic content requirements, particularly the mandate that 50 percent of all parts used must be manufactured in the United States.
In the 1980s, significant retooling of the American automobile industry took place, with a spatial reorganization resulting in auto factories moving away from traditional manufacturing hubs like Detroit to small towns. The Toyota's strategic decision to build plants in the U.S. meant adapting to cultural, political and economic conditions, such as the need for just in time delivery systems, proximity to suppliers, and navigating non-union, lower-wage rural workforces.
Toyota's efforts to meet U.S. manufacturing requirements leveraged these regional shifts. The requirement to manufacture parts domestically could influence Toyota's supply chain, labor relations, and overall production costs, impacting competitiveness and requiring strategies to ensure high-quality vehicles at competitive prices.