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Toyota and Mazda To Build US Plant

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Mazda Makes a Right Turn

On Friday (4 August), the Japanese auto giants said they will join forces to invest $1.6bn in the plant with a capacity to produce 300,000 units a year, and generate employment for up to 4,000 people.

Corolla production in the USA should also take some of the sting off the potential import tax for Toyota, too, as it's one of the brand's bestsellers across the pond, alongside the RAV4 and Camry.

Toyota and Mazda join forces ► New US factory, EV development.

"Toyota Motor said will build a new plant in Baja, Mexico, to build Corolla cars for U.S".

"This is a partnership in which those who are passionate about cars will work together to make ever-better cars", said Akio Toyoda, Toyota's president to reporters.

Taken together, the plans are likely to be trumpeted as a victory for Trump's push to manufacture more locally sold vehicles in the USA, even if it had no impact on the decision. This will result in Mazda acquiring 0.25 percent of Toyota, and Toyota acquiring 5.05 percent of Mazda.

"Toyota and Mazda have been working more closely together, so it is no surprise they will have a plant together", Autotrader.com analyst Michelle Krebs said, adding that Mazda had been searching for USA manufacturing capacity.

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Toyota is vying for the spot of No. 1 automaker in global vehicle sales against Nissan-Renault and Volkswagen AG of Germany, as the industry gradually consolidates. Mazda has not made cars in the USA since a joint partnership with Ford unraveled earlier this decade. With the investment, both automakers can hope to prove their good American corporate citizenship and appease the Trump administration's concerns about jobs moving overseas.

"Mazda has been studying the Toyota Production System, with direct help from Toyota, since the 1970s", said Shook, a former Toyota engineer. "Build plant in USA or pay big border tax".

Toyota began its manufacturing operations in the United States in 1972.

It also gets a boost in electric cars.

Mazda also stands to gain a production stake in the United States, which is its biggest market.

Toyota has been creating alliances with Japanese rivals for years. The location of the U.S. plant has not been made public yet.

As we reported earlier today, Mazda and Toyota have indeed taken a step towards increased collaboration, particularly in the U.S. Toyota is aiming to have such cars on the market by 2020, while Mazda is aiming for a launch in 2019.

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