Toyota, Mazda get together to build an assembly plant in the U.S.

Toyota and Mazda join hands for a $1.6B, 4,000 job assembly plant in the U.S.

Toyota and Mazda to build assembly plant in the U.S.
Toyota Mazda join forces.

Japanese automakers Toyota and Mazda are speculated to announce an assembly plant that they will build in the U.S. The automakers come together for a 50-50 joint venture.

The assembly plant would cost $1.6B to this joint venture and it would create 4,000 jobs. The plant would be in it’s operational form by 2021 and would have the capacity to produce 300,000 vehicles on annual basis. The auto manufacturers have not yet decided the place where this new plant would be build, triggering a potential bid war amongst the U.S. states which vie for the economic development this plant would bring.

It is expected of the companies to invest in each other in the future. The automotive giants are also expected to announce their plans to join forces for the development of electric vehicles, self-driving cars technology and safety equipment. “Toyota and Mazda have been working more closely together, so it is no surprise they will have a plant together,” said Autotrader.com analyst Michelle Krebs. As Toyota is the second biggest automakers in volume, it could be true to say that in this collaboration Toyota would be the elder sibling.

Toyota had their first plant in 1986 in the U.S.. Over the time it has acquired a massive fleet of plants in the U.S. like factories in Alabama Texas, Kentucky,  from where it exports 160,000 vehicles to 40 countries every year.

Toyota also had a plan to build a new $1 billion, plant in Mexico to make the Toyota Corolla sedan, that would employ 2000 workers. This seems to have upset President Trump, whontweeted “no way” in it’s response. This new U.S. plant comes in after Trump’s threat to implement a border tax if Toyota does not invest in production in The Sates. Toyota has also announced plans to invest $10B in operations in U.S. over the next 5 years. Hence, this announcement is viewed as President Trump’s victory who has been threatening foreign carmakers to invest in The U.S.

This new collaboration is said to encourage further industry coalitions.

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