Toyota to build Corollas at revived Mississippi plant starting in late 2011

Toyota will resume construction on its mothballed plant in Mississippi and begin producing the Corolla there late next year.

“We first needed to fully utilize our existing facilities as the economy slowed,” Yoshimi Inaba, president of Toyota Motor North America, said in a statement Thursday. “Now it's time to fulfill Toyota's promise in Mississippi.”

The automaker said it will hire 2,000 workers “soon.”

Corolla output would mark another shift for the project. Toyota broke ground on the 2 million-square-foot factory near Tupelo in April 2007 with an initial plan to assemble Highlander SUVs in late 2009.

In mid-2008, Toyota said it would build the Prius hybrid instead after fuel prices soared and sales of large vehicles sagged. By December 2008, with the U.S. industry on the brink of its worst sales slump in nearly 30 years, Toyota suspended construction with the building's shell basically complete.

The planned Corolla production in fall of 2011 allows Toyota to get the $1.3 billion Mississippi project up and running faster than it could with any other product. Toyota moved 150,000 units of Corolla output to Japan this spring after closing its California plant, New United Motor Manufacturing Inc.

When the Mississippi plant opens, Toyota will bring those 150,000 Corollas back. At that point, almost all Corollas for North America will be produced on the continent. About 40,000 will continue to be shipped from Japan.

Toyota also has capacity to build 150,000 Corollas and sibling Matrix models at a plant in Cambridge, Ontario. The Corolla and Matrix are the third-best selling cars in the United States, behind the Honda Accord and Toyota Camry. The Canada plant absorbed about 25,000 of NUMMI's Corollas.

Despite the uncertainty surrounding the project, the state of Mississippi in April decided to go forward with a $90 million investment to provide highway access to the site for suppliers.

The renewed project is another sign of comeback for the U.S. auto industry after the steepest recession since the Great Depression. U.S. auto sales rose 16 percent through May from year earlier. Toyota, battling recalls and consumer concerns about quality, has lost share while posting an 11 percent gain.

Lindsay Chappell contributed to this report

By Amy Wilson- Automotive News