At the Licensing Show in New York the head of Disney Consumer Products, Andy Mooney, announced that the studio is proceeding with the production of Toy Story 3 for release in the summer of 2008.  Disney has been busy recruiting computer-savvy animators at the SIGGRAPH show in Los Angeles, where according to the Animation World Network, the company described the story arc of Toy Story 3 in which the Buzz Lightyear toy (voiced by Tim Allen) is recalled to Taiwan and the rest of the toys led by Woody (Tom Hanks) have to save Buzz from destruction.

According to the agreement between Disney and the Pixar Studio, which produced the first two Toy Story films, the Pixar properties will revert to Disney if the distribution and financing agreement between the two studios, which expires after the release of next summer's Cars, is not extended (see 'Disney Preps Unit For Pixar Sequels').