Japanese auto manufacturers Toyota and Mazda are planning to co-build and operate a $1.6 billion assembly plant in the U.S., according to the Detroit Free Press.
The plant will generate 4,000 jobs, produce up to 300,000 vehicles each year and should be fully operational by 2021. The companies have not yet made a formal announcement and they have not selected a site. They are also expected to announce plans to collaborate on electric and self-driving cars.
It is unknown if the assembly plant is part of the $10 billion, five-year plan of U.S. investment Toyota announced in January. Another unknown from the Toyota–Mazda deal is whether the companies will seek financial incentives from local and state governments.
As the standard of living — and wages — rise around the world, countries where goods manufacturing used to be inexpensive in comparison to the U.S. don't offer the cost advantages they once did. In addition, companies with wide distribution in the U.S. can avoid shipping costs and export fees by transferring their operations stateside.
The result could be more manufacturing construction in the U.S. in the coming years. Some such projects are already underway.
Austrian particleboard manufacturer Egger announced plans last month to spend $700 million in the next 10-plus years to build a manufacturing facility in Davidson County, NC. At full build-out, the plant would employ 770 workers, which was part of the deal with local and state officials. Egger is slated to receive $10.3 million in financial incentives for locating its facility there. At least $5.3 million of that depends on the wood-based manufacturer's ability to create jobs.
An even bigger payoff for U.S. workers could come from the Taiwan-based electronics manufacturer Foxconn. The company also announced last month that it was investing $10 billion into a Wisconsin flat-panel display screen factory. The company said it would employ 3,000 workers there in exchange for $3 billion in economic incentives from the state over 15 years. The company is reportedly planning another new U.S. facility, this time in Michigan and dedicated to autonomous vehicle technology.