NEW YORK – Toyota Motor Corp. plans to shift production of Highlander sport utility vehicles to Indiana from Japan in late 2013 in a move to turn North America into its global production base amid the yen’s record-high levels.
Production of the Highlander at the automaker’s plant in Princeton, Indiana, is expected to increase by 50,000 units to about 330,000 vehicles, it said Wednesday. Around 30,000 vehicles were manufactured at Toyota’s facility in Fukuoka Prefecture last year.
The carmaker plans to export about 30,000 vehicles of the additional output to countries including Russia and Australia.
Toyota’s growing moves to shift output from Japan to North America could accelerate the hollowing out of the domestic auto industry.
Toyota will also start producing a Highlander hybrid model in Indiana in 2013 with a projected output of 10,000 units per year. It will be the second Toyota hybrid produced in the United States, after a hybrid model of its mainstay Camry.
The automaker said it will invest about $400 million in the Indiana factory, creating about 400 new jobs.
Toyota’s Fukuoka factory, which in addition to the Highlander has been producing several Lexus premium brand models and the Sai hybrids, is expected to have an output of 305,000 units in fiscal 2011.
Highlander vehicles targeting the North American market have been manufactured in Fukuoka and Indiana so far, but the company decided it would be more efficient to have a single production base. The decision was prompted also by the smaller likelihood of being hit by exchange-rate fluctuations.
“This project is part of our localization strategy to build vehicles where we sell them,” said Norm Bafunno, president of Toyota Motor Manufacturing Indiana, Inc.
Toyota has already decided to shift the production of the Corolla, its main compact vehicle for the North American market, from Japan to Mississippi.
Toyota’s group operating profit plunged 72.3 percent to ¥117.11 billion in the April-December period, pressured by the strong yen and the impact of supply chain disruptions caused by the March 11 megaquake and tsunami.