Japanese automakers Toyota and Mazda have picked Alabama as the site of a new $1.6 billion joint-venture auto manufacturing plant, a person briefed on the decision said Tuesday.
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.
Toyota has 10 USA plants in eight states in an arc running from West Virginia through Kentucky, Indiana, Alabama, Mississippi and Texas.Toyota and Mazda announced a capital alliance in August and are exploring joint development of technologies for the basic structure of competitive electric vehicles.
Alabama is the fifth largest producer of cars and light trucks nationally and stands at the center of the growing Southeastern automotive region with a strong automotive presence including Toyota's engine plant in Huntsville. US new vehicle sales fell 2 percent in 2017, after hitting an all-time record high in 2016, and are expected to fall further in 2018. The companies said they expect the plant to open in 2021.
"It's is a great day for Alabama", Former Alabama Governor Jim Folsom, Jr. said.
We are honored Alabama is truly honered to have been chosen for this project.
"With this announcement, our world changes overnight", said Tommy Battle, mayor of Huntsville. The area has many parts factories that provide products to the automakers.
Alabama was tied with Tennessee as the fifth-largest producer of vehicles in the country previous year, according to the Center for Automotive Research, an industry think tank in Ann Arbor, Michigan.More news: Bannon: 'I regret' delay in responding to book
For Mazda, the plant comes on line in a significant year that marks 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.
The person didn't want to be identified because the decision hasn't been made public.
For Toyota, this joint-venture plant will be its 11th USA manufacturing facility and represents its continued commitment in the US, in addition to the $10 billion dollar investment over the next 5 years that was announced in January 2017.
The new plant -in a state Trump won by 28 points in 2016 - could be a political boost to the Republican president, who has urged automakers to build plants in the United States and add jobs. By Wednesday, the makers had obtained the necessary permissions from the state of Alabama.
Another factor is auto supplier jobs.
Dziczek said that Alabama in 2017 was tied for fifth among US states in auto production, at 9 percent with Tennessee.
US sales of small cars fell almost 10 percent a year ago as buyers continued a massive shift toward SUVs and pickup trucks.