Reports: Toyota, Mazda pick Alabama for $1.6B, 4,000-job plant

Nathan Bomey | USA TODAY

Toyota and Mazda have reportedly picked Alabama as the location of their new $1.6 billion, 4,000-job assembly plant, capping a national race to score the biggest economic development prize in years for the auto industry.

The Japanese automakers are set to announce that they will locate their new joint-venture factory in a state that already has Toyota, Hyundai and Mercedes-Benz factories, according to Reuters and the Birmingham Business Journal.

The move suggests that Toyota and Mazda may be poised to capitalize on a sharp increase in state tax incentives recently signed into law by Gov. Kay Ivey.

It also reflects the strength of Alabama's manufacturing sector. The state assembled more than 1 million vehicles in 2016 at plants employing nearly 40,000 workers. The statewide unemployment rate was 3.5% in November.

Alabama was long viewed as one of the leading contenders for the factory because of its tax incentives, low-cost labor and bustling automotive sector. The state's factories are also not unionized — a factor that seems to appeal to foreign automakers.

Toyota, Mazda building $1.6B plant in USA President Trump applauded Toyota and Mazda's plan to set up the joint venture in the USA and create up to 4,000 jobs.

Officials from Toyota and Mazda declined to comment late Tuesday afternoon.

Reuters reported the plant would be located in Huntsville, while the Birmingham Business Journal reported the factory would be built at "a mega site" in Limestone County just west of Huntsville.

A spokesperson for Ivey would not immediately comment on the reports, and other local officials could not be reached.

Job-creating projects of this magnitude are rare. It would be only the fourth new U.S. assembly plant in about the last decade when it opens in 2021.

Toyota and Mazda announced their deal to collaborate in August, saying they would make a decision on where to locate the facility after Jan. 1.

The announcement marked a victory for President Trump, who had disparaged Toyota for selling vehicles in the U.S. that are made in foreign markets. About half of Toyota vehicles sold to Americans are made domestically, according to Barclays.

By contrast, Mazda imports all of its U.S.-sold vehicles.

Follow USA TODAY reporter Nathan Bomey on Twitter @NathanBomey.