The majority of companies downsized as a result of effects from the Dodge Line, generating a steady stream of laid-off workers. Toyota Motor Co. conducted labor talks based on a policy of sharing what little it had to prevent layoffs, but the company faced the potential risk of bankruptcy without bank financing, and personnel adjustments became unavoidable.
Based on a corporate revival plan, the Kamata Plant and Shibaura Plant, which were far from achieving independent profitability, were closed on June 10, 1950. A total of 2,146 employees were laid off including 378 from the two plants, reducing employment to 5,994 persons. At that time, President Kiichiro Toyota decided to resign.