Toyota Motor Corp. and Mazda Motor Corp. are pressing for an incentive package of at least $1 billion from U.S. states trying to land their $1.6 billion joint car factory, according to sources familiar with the negotiations.
Toyota and Mazda plan to brief their boards on a short list of states contending for the plant in the coming weeks and announce a final selection by the end of year, the sources said.
Scott Vazin, a Toyota spokesman, and Jeremy Barnes, who represents Mazda, both declined to comment.
The tax breaks and other support Toyota and Mazda are reportedly asking for could rival the package Nevada approved for Tesla Inc.’s Reno battery factory in 2014 that was valued at as much as $1.25 billion.
The carmakers have positioned themselves to drive a hard bargain with states by pledging to create as many as 4,000 jobs.
“There haven’t been any big prizes like this in a while, and there isn’t expected to be any more for some time as overall auto production plateaus,” said Kristin Dziczek, director of industry research at the Center for Automotive Research in Ann Arbor, Michigan. “The competing states may be willing to put more on the table than they would have previously.”
The shared factory Toyota and Mazda plan to open in 2021 is the only new auto assembly plant to be announced under President Donald Trump, who has pressured Toyota and other carmakers to make more of their vehicles in the U.S.
Mazda, which imports all of the models it sells in the U.S., plans to produce crossovers alongside Toyota Corolla compact cars at the new plant.
More than a dozen states have either confirmed their interest or have been connected to proposals for the factory, including Michigan, Ohio, Indiana, Texas, Alabama, North Carolina and South Carolina. Governors that already have large Toyota plants such as Mississippi’s Phil Bryant have said they would compete and benefit from existing infrastructure and relationships with the company.
In a time of both misinformation and too much information, quality journalism is more crucial than ever.
By subscribing, you can help us get the story right.