Toyota and Mazda announce Alabama plant

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The joint venture will receive roughly $380 million in incentives from the state of Alabama, including a jobs credit of $90.6 million and an investment credit of $210 million over 10 years, according to a release from the Alabama Department of Commerce.

The plant will employ about 4,000 people and will be built in Limestone County near Huntsville.

Most of Toyota's US plants are in the South, and all are non-union.

The joint plant forms part of a plan unveiled by Toyota in January 2017 to invest $10 billion in the USA over the next five years.

"Their decision to locate this new facility in Huntsville is a testament to the talented workforce in our state".

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 a new Mazda crossover model that will be introduced to North American markets and the Toyota Corolla. President Akio Toyoda joined Governor Ivey for the announcement.

"The impact of an auto assembly plant extends beyond its immediate economic impact, and that's why states offer robust incentives", said Dennis Cuneo, a site-selection consultant and former Toyota executive.

USA sales of small cars fell almost 10 percent previous year as buyers continued a massive shift toward SUVs and pickup trucks.

The person didn't want to be identified because the decision hasn't been made public.

Expected to open in 2021, the plant breaks ground at a time where US auto sales are on a decline, meaning increased pressure to cut costs could jeopardize the automakers' plans to scale up USA production. It will be Toyota's eighth such facility in North America and the second for Mazda.

"With this announcement, our world changes overnight", said Battle. The Huntsville area already has a Toyota engine factory that employs almost 1,500 people. "It vaults Alabama to the top as an industry leader in producing the next generation of cars that will power our nation".

Japanese automakers Toyota and Mazda say they will build a joint factory in the USA state of Alabama.

Amid tightening environmental regulations in the USA, the likely challenge will be to create new added value, such as locally producing electric cars and replacing production models to better reflect demand.

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.

The news website reports that there are 57,000 Alabama residents employed in the industry, with more than 160 companies comprising the supplier chain.