Toyota and Mazda announce Limestone County plant

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Toyota Motor and Mazda Motor have chosen the southeastern US state of Alabama as the site for a new joint plant costing in the region of $1.6 billion, sources said Wednesday.

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

Alabama Gov. Kay Ivey and company executives made the announcement in a Wednesday news conference.

Ivey said, "This is indeed a great day in Alabama".

"The partnership between Toyota and Mazda will expand innovative automotive manufacturing in Alabama", Governor Ivey said. "Welcome to sweet home Alabama".

Details of an anticipated tax and incentive package for the investment were not yet known. The state will also provide workforce training.

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

With the addition of the new plant, Toyota will have 11 manufacturing plants across the U.S. Mazda now doesn't have a manufacturing presence in the U.S. To entice manufacturers, Southern states have used a combination of lucrative incentive packages, low-priced labor and a pro-business labor environment since the United Auto Workers union is stronger in Northern states.

The plant is expected to start building cars in 2021, and will eventually churn out 300,000 vehicles per year.

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 USA, threatening crippling tariffs on automakers that didn't build new facilities in the states. With more than 150 Tier 1 and 2 automotive suppliers in the state as well as automakers, there are approximately 57,000 automotive manufacturing jobs in Alabama. The plan calls for rolling out 300,000 passenger cars a year to the United States market. USA new vehicle sales fell 2 percent in 2017, after hitting an all-time record high in 2016, and are expected to fall further in 2018.

Still, Toyota and Mazda have said their collaboration will respect mutual independence and equality.

In October, Toyota said it would scale back investment in a planned plant in Mexico by 30 percent to $700 million and cut planned annual capacity in half to 100,000 vehicles as it shuffles its production plans to meet market demands. Working together on green and other auto technology also makes sense as the segment becomes increasingly competitive because of concerns about global warming, the environment and safety.

Alabama spent an estimated $250 million to woo Daimler AG's Mercedes-Benz to put an auto plant in Tuscaloosa in two decades ago. Honda and Toyota followed by putting engine plants in the state.