Toyota and Mazda have made it official by announcing their new joint venture plan to build a new $1.6 billion assembly plant in the northern Alabama city of Huntsville that will support 4,000 new jobs when it opens in 2021.
For Toyota, this joint-venture plant will be its 11th U.S. manufacturing facility and represents its continued commitment in the U.S., in addition to the $10 billion investment during the next five years that was announced in January 2017, Toyota CEO Akio Toyoda said.
“Our investment to establish a new vehicle assembly plant with Mazda builds on the strong success we have enjoyed in Alabama where we produce engines for the North American market,” Toyoda said. “Starting from 2021, I’m confident that we will run a highly competitive plant, by bringing together the expertise of Toyota and Mazda as well as the excellent Alabama workforce.”
The new plant will have the capacity to build 300,000 vehicles annually, with production split evenly between two lines for each company to produce Mazda’s crossover model that will be newly introduced to the North American market and the Toyota Corolla, the official announcement said.
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The site for the new plant is in Huntsville, the company’s second facility in the city and located approximately 14 miles from Toyota’s Alabama plant Toyota Motor Manufacturing Alabama Inc. Already having a plant in the area gave the State of Alabama an edge from the start of the competition, which started last summer and involved more than a dozen states.
The final incentive package for the project, which was influenced by Amazon’s lavish hunt for a second headquarters, is expected to surpass $1 billion.
The joint venture represents a $1.6 billion investment that Mazda and Toyota plan to make with equal funding contributions. The facility is expected to create up to 4,000 jobs. Production is expected to begin by 2021.
For Mazda, the plant comes online in a significant year. It will mark the start of the company’s second century of operation and second half-century of sales in the U.S. The automaker is enhancing its commitment to the U.S. market and will focus efforts on manufacturing and increasing sales in the country.
“Mazda makes cars with a clear vision of how we want to inspire people, contribute to society and help preserve the beauty of the earth,” Mazda CEO Masamichi Kogai said.
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“By making such cars here in Alabama, we hope that over time our plant will come to occupy a special place in the hearts of our employees and the local community. By making this plant a vibrant part of that community, we hope to work, learn and grow together with the people of Alabama and Huntsville.”
“The partnership between Mazda and Toyota will expand innovative automotive manufacturing in Alabama,” Governor Kay Ivey said.
“Their decision to locate this new facility in Huntsville is a testament to the talented workforce in our state. We are proud that this partnership puts Alabama on the forefront of technology in this dynamic global industry.”
The State of Alabama is the fifth largest producer of cars and light trucks nationally with a strong automotive manufacturing presence including Toyota’s engine plant in Huntsville, where Toyota employs 1,400 team members.
For the past year, the Trump administration has pressured car makers to make investments in the U.S. rather than Mexico. Ford scrapped plans for a new factory in Mexico last year and Toyota Motor Corp. has changed its plan to make Corollas at a plant in Guanajuato, Mexico, now under construction, and instead will produce Tacoma pickups there, Toyota said.
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Akio Toyoda denied recently that Trump’s views influenced his decision. “We have been reviewing the best production strategy for our business,” he told reporters in Tokyo at the time.