Toyota Motor Corp., the world’s biggest automaker, is being offered $146.5 million in tax incentives by Kentucky to expand a plant in the state that’s already the company’s largest in North America.
The Kentucky Economic Development Finance Authority approved the package yesterday, based on Toyota enlarging its auto-assembly factory in Georgetown by 2015 to produce an additional model. The Toyota City, Japan-based company would have to invest $531.2 million and add 570 full-time jobs to receive the full value of the credits, the agency said in an e-mailed statement.
“Securing this significant investment in Georgetown, Kentucky would be a huge economic development victory,” Mandy Lambert, a spokeswoman for the Kentucky agency, said in a separate e-mail.
Toyota President Akio Toyoda and other senior executives including Jim Lentz, the carmaker’s chief executive officer for the North American region, will make a production announcement on April 19 in New York, the company said in a statement. Toyota will produce Lexus models at the plant, Kyodo reported, citing no one. The company is moving production of some Lexus ES cars to the U.S., the Wall Street Journal said, citing a person familiar with the matter it didn’t identify.
Toyota’s American depositary receipts fell 1 percent to $110.55 at the close in New York. The depositary receipts gained 19 percent this year compared with an 8.1 percent increase for the Standard & Poor’s 500 Index.
Mike Goss, a spokesman for Toyota’s North American manufacturing unit, said before the company issued the statement that it hasn’t yet decided to expand the factory. Toyota has been informed of the incentive package, he said, without elaborating.
Toyota is considering increasing the Georgetown capacity by 50,000 units annually starting in 2015, according to the Kentucky statement, which didn’t specify the new model.
The Georgetown plant, opened in 1988, is the main production site of Camry sedans, the best-selling U.S. car for the past 11 years. Toyota has invested $6 billion at the site. The factory employs about 6,600 people and can build more than 500,000 vehicles and 600,000 engines annually, according to the company’s website. The new project could add 750 jobs when contract workers are included, according to the Kentucky statement.
Georgetown is “competing with other Toyota plants for the opportunity to build this new model in North America,” the agency said in the statement.
The state incentives were reported earlier by the Louisville Courier-Journal.
Toyota’s U.S. sales unit is based in Torrance, California.