Toyota eyes southern U.S. for assembly plant

updated 11:43 a.m. ET Jan. 4, 2007

DETROIT - Toyota Motor Corp. may name a site in the southern United States for its eighth North American assembly plant as early as this month.

Company spokesman Dan Sieger said Thursday that the Japanese automaker is considering expanding its manufacturing capacity in North America and is currently reviewing sites, but declined to reveal details.

Separately Thursday, citing people familiar with the matter The Wall Street Journal reported that Toyota is considering three to five locations, including Chattanooga, Tennessee, and Marion, Arkansas. Other sources told the paper that a location near Alamo, Tenn., and one in North Carolina are also possibilities the Journal said.

The new plant would have annual manufacturing capacity of 200,000 vehicles and start production in 2009, sources told the Journal. It and other plants being built and ramped up would increase manufacturing capacity to about 2.2 million vehicles a year, compared with 1.5 million now, the paper said.

The plant would likely produce the next-generation Toyota Highlander sport-utility vehicle and possibly a tall station wagon like the Chrysler Pacifica, the Journal said. The wagon is called the Ace and is a replacement for the Toyota Solara, people familiar with the matter told the paper.

The move, which Toyota has been pondering for months, would show that Toyota will try to take more of the U.S. market from domestic rivals in the next several years, the Journal said.

It also would strengthen Toyota’s hand if a backlash against non-U.S. brands arises from the increasing troubles of domestic automakers and their suppliers, the paper said.

Toyota will likely expand its existing engine-manufacturing facilities in the United States, most likely by beefing up its engine plant in Alabama, the Journal said, citing sources.

A decision on engine-manufacturing expansion also will likely come before the end of the first quarter of 2007, the Journal quoted sources as saying.

A spokeswoman for Toyota Motor North America was not immediately available for comment.

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