Toyota Motor Corp. and Mazda Motor Corp. will build a new $1.6 billion assembly plant in Huntsville, Ala., according to people familiar with the companies’ decision, a move that boosts their production capacity in the U.S. and adds to large and growing foreign auto maker presence in the southern state.
Toyota TM, -0.78% 7203, +1.72% and Mazda 7261, +0.79% first announced plans in August for the new plant, which will create 4,000 jobs and make up to 300,000 vehicles a year by 2021. Toyota has said it will build 150,000 Corolla models and Mazda will use the rest of the capacity for an unspecified model.
Alabama is home to three other vehicle assembly plants operated by foreign auto makers: Daimler AG’s DAI, +0.80% Mercedes-Benz unit, Honda Motor Co. 7267, +2.22% and Hyundai Motor Co. 005380, +2.30% . In September, Daimler said it would invest $1 billion at its Alabama facilities on top of the $5.8 billion it has spent in the state since it began vehicle production there in 1997.
The selection of Huntsville comes a year after Toyota was criticized by U.S. President Donald Trump for plans to build a new plant in Mexico. The Japanese company announced plans within days of that to spend $10 billion in the U.S. over the next five years.
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