NAGOYA (Kyodo) Toyota Motor Corp. plans to build a new automobile-assembly plant in Japan to keep pace with strong global demand and create surplus output capacity to allow renewal of old production lines at some existing domestic plants, sources said Friday.

The No. 1 Japanese automaker is considering Hokkaido or the Tohoku region as a possible location for the plant, which will be built with an investment of ¥100 billion and may go onstream in 2009, the sources said. The plant site will be decided by the end of this year, they said.

Under the plan, the new assembly plant will roll out an annual 100,000 to 200,000 vehicles, creating surplus output capacity.

But capacity at Toyota’s existing assembly plants in Japan has almost reached its limit and some of their production lines have become old and need to be modernized.

A Toyota spokesman said the company is “always studying what the optimal production system should be, but currently has no specific plan” to alter its output system.

Industry analysts said Toyota’s planned assembly plant would be a boon to local economies in northern parts of Japan that have lagged behind the current recovery cycle in the country.

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