Alabama Gov. Kay Ivey, Huntsville Mayor Tommy Battle, and officials from Toyota and Mazda announced Wednesday afternoon that Japanese automakers Toyota and Mazda will build a $1.6 billion automotive plant in Huntsville-annexed Limestone County, bringing thousands of jobs to the area.
Ivey made the announcement in a 2 p.m. Wednesday news conference carried LIVE on WAAY-TV and streamed at waaytv.com.
According to reports, the plant will be built on a site between Powell Road and Greenbrier Parkway that is certified as a Tennessee Valley Authority "mega site" -- a designation that means it is a prime location for industry complete with interstate access, the potential for rail service, and utility service capable of serving a major manufacturing facility.
"With this announcement, our world changes overnight," said Huntsville Mayor Tommy Battle. "It vaults Alabama to the top as an industry leader in producing the next generation of cars that will power our nation."
Toyota and Mazda plan to split the cost of the plant equally. It's expected to begin operation in 2021 and would build Toyota Corollas and a new small SUV from Mazda, the companies have said. The facility would be able to building 300,000 vehicles a year.
"Our investment to establish a new vehicle assembly plant with Mazda builds on the strong success we have enjoyed in Alabama where we produce engines for the North American market," said Toyota President Akio Toyoda.
In 2008, the area was a potential home for Volkswagen to locate a manufacturing plant. That site ended up going to Chattanooga, where according to the company, 3,200 people are employed.
Toyota already has an engine manufacturing plant in Huntsville that employs 1,450 people. That plant, which makes engines for Toyota trucks and SUVs, recently announced it is investing $106 million to revamp its engine production line.
The companies originally announced plans for the plant in August when the two Japanese automakers signed a joint venture agreement, though the location was not known at that time. But the companies said at that time that the plant would be in the United States.
The plant is expected to start building cars in 2021. Toyota will use the plant to build its best-selling compact car, the Corolla, while Mazda will use its production to build a new crossover vehicle.
Toyota had originally planned to build a new Corolla plant in Mexico, but after the joint venture plans were announced in August, Toyota changed course and decided to build the Tacoma pickup at the plant in Mexico and the new Corolla production at the new U.S. plant.
Toyota had been under fire about building Corollas in Mexico. Just before taking office last January President Trump attacked Toyota's plans.
"Toyota Motor said will build a new plant in Baja, Mexico, to build Corolla cars for U.S. NO WAY!" Trump tweeted. on January 5, 2017. "Build plant in U.S. or pay big border tax."
But despite the threat of a border tax, Toyota is moving ahead with plans to build trucks at the Mexico plant, even if it will not build Corollas there.
The company had been making Corollas in the U.S. at a plant in Blue Springs, Mississippi and always planned to keep making vehicles there. By building the new Corolla plant in Huntsville, rather than Mexico, it will have easier access to suppliers of Blue Springs plant. Those suppliers are mostly based in the South.
Toyota has 10 existing U.S. factories. Overall it has 36,000 U.S. employees, not including those at dealerships. It produces most of the cars and trucks it sells in the U.S. at those U.S. plants and exports some of those cars to other markets.
Most of Toyota's U.S. plants are in the South, and all are non-union. Mazda does not currently have any U.S. factories. Other foreign automakers have built plants across the U.S. South as well. Alabama is the fifth largest state in terms of auto production with more than 1 million cars built there annually. In addition to the existing Toyota engine plant it has plants for Hyundai, Honda and Mercedes-Benz. It also has a relatively low unemployment rate of only 3.5%, the lowest rate in the state's history.