Toyota Said to Build New Compact Hybrid Model at New Northern Japan Plant

Toyota Motor Corp. will build a new compact hybrid model at a plant in northern Japan as it reorganizes domestic production, a person familiar with the company’s plans said.

Central Motor Co., an assembly unit of Toyota, will produce the model at a plant in Ohira, Miyagi prefecture, according to the person, who declined to be identified as the plans are private. The carmaker showed a compact version of the Prius hybrid at the Detroit auto show last month.

The automaker, based in Toyota City, is shifting production from its main manufacturing area as the strong yen hurts earnings from exports. Lower labor costs relative to Aichi prefecture, Toyota’s primary domestic production hub, and a nearby port may make Miyagi, about 370 kilometers (230 miles) north of Tokyo, more attractive for exports.

Toyota spokesman Keisuke Kirimoto declined to comment on whether the company will build hybrids in Miyagi.

Toyota plans to begin selling a “city-centric” compact version of the Prius hybrid in the U.S. in the first half of next year. The car was first shown as the Prius c concept model at the Detroit auto show last month.

President Akio Toyoda has said the company will maintain domestic production of about 3 million cars. Toyota built 3.2 million cars in Japan last fiscal year out of 7.3 million units worldwide.

While cars may eventually be shipped out of the Port of Sendai, which is 28 kilometers from the Ohira plant, they will be exported from the Port of Nagoya in Aichi until production reaches sufficient volume, the person familiar with Toyota’s plans said.

To contact the reporters on this story: Makiko Kitamura in Tokyo at mkitamura1@bloomberg.net

To contact the editor responsible for this story: Kae Inoue at kinoue@bloomberg.net

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