Toyota Motor Corp. confirmed today the unofficial reports of its plans to expand in Mexico: it will build a US $1-billion assembly plant in Celaya, Guanajuato, where it will produce the Corolla.
The factory will feature the latest in engineering technology, create 2,000 jobs and produce 200,000 vehicles a year, the auto maker said in a press release. Production will begin in 2019.
An official announcement was made today at Los Pinos, the official residence of President Peña Nieto.
Mexico’s gain of the new plant is not being seen as a loss for Canada, where the Corolla has been manufactured since Toyota began making vehicles there in 1988. That plant, located in Cambridge, Ontario, will produce instead “mid-sized, higher-value vehicles,” the company said, but without offering further details.
It also promised “significant new investments over several years” at plants in both Cambridge and Woodstock, Ontario.
Toyota’s manufacturing costs in Canada are higher than those at its factories in the U.S., and considerably higher than they are in Mexico, leading to what one analyst describes as the erosion of Canada’s competitive position in automotive manufacturing.
Shifting Corolla production to Mexico from Cambridge (where 3.5 million were produced in total), “is a sign that . . . Toyota no longer generates sufficient profit from manufacturing in Canada the bestselling vehicle in its Canadian lineup,” wrote Greg Keenan yesterday in the Globe and Mail newspaper.
About 3,000 of the company’s 5,600 employees in Cambridge are employed assembling the Corolla.
Meanwhile, Ford Motor Co. is expected to announce Friday the construction of two new plants for Mexico, an investment that Canadian government authorities had hoped would be made in Ontario.
Source: CNNExpansión (sp)