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Toyota to invest $10 billion in U.S. over five years
January 9, 2017 / 7:14 PM / 9 months ago

Toyota to invest $10 billion in U.S. over five years

The 2018 Camry XSE (L) and the 2018 Camry XLE are introduced during the North American International Auto Show in Detroit, Michigan, U.S., January 9, 2017. REUTERS/Mark Blinch

DETROIT (Reuters) - Toyota Motor Corp (7203.T) will invest $10 billion (£8.2 billion) in the United States over the next five years, the same as in the previous five years, North America Chief Executive Jim Lentz said on Monday, to meet demand and upgrade plants to build more fuel-efficient models.

The Japanese automaker has come under fire by President-elect Donald Trump for its plans, announced in 2015, to shift production of its Corolla to Mexico from Canada.

Lentz said in an interview at the Detroit auto show the decision was not in response to Trump’s remarks made in a recent tweet, but was part of Toyota’s business strategy to invest in the United States, where it has 10 plants in eight states.

Planning for the new Mexico plant began about two years before it was announced in 2015, said Lentz, describing such decisions as long-term ones.

Lentz said he had not spoken with Trump.

The $10 billion includes Toyota’s new North American headquarters in Texas that is under construction and major improvements to its plants.

Toyota plans to expand some of its U.S. plants over the next five years, said Lentz, declining to say if that effort would boost jobs. Toyota, which employs 40,000 in the United States, added more than 5,000 U.S. jobs over the last five years, he said.

Toyota President Akio Toyoda appeared at the show later on Monday to tout the company’s investment plans and its updated flagship Toyota Camry that is built in Kentucky.

Jim Lentz, president and CEO of Toyota Motor Sales, U.S.A. speaks during an interview in New York, March 28, 2013. REUTERS/Brendan McDermid

“We are deeply grateful to the millions of customers who have made Camry the number one selling car in America for the last 15 years,” Toyoda said.

Lentz said “everyone” agrees with Trump’s goals of boosting manufacturing and U.S. employment, in part because “it helps us sell more cars.”

“We have to run our business as a global business,” he said. “I have to make sure that we are competitive.”

The company is focussed on reminding policymakers in Washington about its extensive U.S. manufacturing operations, Lentz said.

Lentz said Vice President-elect Mike Pence, who was Indiana governor, knew Toyota well because of its manufacturing operations in the state.

He warned that a “border adjustability tax,” like the one proposed by Trump if the carmaker builds the Corolla in Mexico instead of the United States, could hike the price of cars and hurt auto employment.

Such a tax could add $1,000 to cost of a Kentucky-built Camry because of some foreign-made parts.

After the critical tweet from Trump, “you have to respectfully state your position and then move on,” he said.

Reporting by David Shepardson and Norihiko Shirouzu in Detroit; Editing by Nick Zieminski and Bernadette Baum

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