Bevin officials: Alabama lands Toyota-Mazda plant, but Kentucky still benefits

Employees work on an assembly line of the Toyota Motor Corp's Prius hybrid car at the Tsutsumi plant in Toyota central Japan

Reports have indicated that Alabama and North Carolina were the two finalists for the Toyota-Mazda plant. 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, Jan. 9, 2018.

Toyota and Mazda are expected to split the cost of the plant, but state and local governments expect to heavily incentivize the automakers for locating in Alabama.

The plant's location was made official Wednesday afternoon.

After their announced manufacturing partnership in the USA last August, Toyota Motor Co. and Mazda Motor Corp. decided on the site of their $1.6 billion joint production plant.

Toyota will build the Corolla at the new factory, while Mazda will produce a crossover that will be newly introduced to North America.

The joint venture represents a $1.6 billion investment that Mazda and Toyota plan to make with equal funding contributions.

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.

Following Pres. Donald Trump's tariff-tough talk in 2016, Toyota was grilled by the then-President-Elect via Twitter about moving manufacturing jobs outside the US, threatening crippling tariffs on automakers that didn't build new facilities in the states.

Trump tweeted in March that he wanted "new plants to be built here for cars sold here".

The company had been making Corollas in the U.S.at a plant in Blue Springs, Mississippi, and always planned to keep making vehicles there.

Toyota now operates 10 plants in eight states including West Virginia, Kentucky, Indiana, Alabama, Mississippi and Texas.

But with US auto industry sales are declining, the new plant could exacerbate overcapacity and add pressure to cut prices. Many automakers have announced expansions of facilities or new jobs but no other new USA auto plants have been announced. "Further, the whole opportunity to pitch Kentucky for the plant underscored just how important of a corporate citizen Toyota is in the commonwealth". Mazda does not now have any US factories. Toyota already has a large presence in Huntsville, as Toyota Motor Manufacturing Alabama already employs 1,450 people. Other foreign automakers have built plants across the South as well. The state got its first auto plant, Mercedes-Benz, 25 years ago. It also has a relatively low unemployment rate of only 3.5%, the lowest rate in the state's history.

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