Alabama expected to land Toyota, Mazda plant

Pauline Gross
January 13, 2018

Amid tightening environmental regulations in the USA, the likely challenge will be to create new added value, such as locally producing electric cars and replacing production models to better reflect demand.

Mazda has a plant in Mexico, a country that also hosts the manufacturing bases of related parts makers, which facilitates parts supplies to the southern U.S. "Congratulations Alabama!" he wrote.

"Obviously the Georgetown plant is a huge facility", Baum said.

Alabama's established auto industry was the key factor for landing the new factory. USA new vehicle sales fell 2 percent in 2017, after hitting a record high in 2016, and are expected to fall further in 2018.

Now, a joint Toyota-Mazda plant is on the way to Huntsville and is expected to employ 4,000 people along with "three or four times" that many at a network of suppliers across the state.

Among U.S. states, Alabama is already the fifth largest producer of cars and light trucks. And the plant will produce $951 million in net revenue to the state after the incentives are taken into account.

"As governor, it is my honor and privilege to announce that Mazda and Toyota have chosen Alabama as the home of their new production plant".

While it's not yet known the amount of tax incentives the automakers received for their new production plant, it has been reported that the two companies sought at least $1 billion in incentives, according to Reuters. A Kia Motors Corp assembly plant operates near the Alabama border in Georgia.

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Akio Toyoda, president of Toyota Motor Corp., left, and Masamichi Kogai, president and chief executive officer of Mazda Motor Corp., shake hands during a news conference in Tokyo in August.

When Volkswagen chose to add 2,000 jobs at its plant in Chattanooga, Tenn., in 2015, a University of Tennessee study found the expansion created 9,800 other jobs in the region.

When Toyota and Mazda announced their joint venture in August a year ago, Trump took to Twitter to praise the Japanese automakers for their American-centric decision. The city already is home to a Toyota engine plant that employs about 1,500 people. Mazda will produce crossovers alongside Toyota Corolla compact cars at the joint facility.

"These plants are going to live 30, 50 years plus and we have to make good business decisions", he said.

Tom Sisk said he was "ecstatic" when he heard the news, calling it "the biggest economic announcement in 25 years". He called the $800 million investment a "bargain" to get the additional volume. Toyota and Mazda are making a major investment in a new factory in the area. Since the beginning of past year, companies have announced about $3.2 billion in investments toward Alabama's auto industry. And again Canfield dismissed the idea that the state may not have enough workers to fill those jobs.

Mark Wakefield, global co-head of automotive and industrial at AlixPartners, another consulting firm, sees a modest decline in vehicle sales this year and a steeper drop in 2019 and 2020.

Most of the students at Lawson State go into Tier 1 companies, that make the auto parts. "We've never been this ready before with a site and a team together to ... go forward".

Other reports by GizPress

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