Toyota to revamp Ontario plants with government help

Tue Jul 5, 2011 11:56am EDT
 
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TORONTO (Reuters) - Automaker Toyota Motor Corp, along with the governments of Canada and the province of Ontario, will invest a total of C$545 million ($567.7 million) to upgrade Toyota's assembly plants in Ontario.

The Canadian federal government and the Ontario government said on Tuesday they will each invest C$70.8 million in the plants to help create jobs in Ontario, where the auto industry is a key employer but took a beating during the 2008-09 economic downturn.

The investment comes as Toyota's North American plants work to get back to normal production levels after cutbacks caused by disruptions in parts supply resulting from the earthquake and tsunami in Japan in March.

Toyota Canada manufactures the Toyota Corolla, Toyota Matrix, Toyota RAV4 and Lexus RX 350 vehicles at two plants in Cambridge, in southern Ontario, and at one plant in nearby Woodstock.

"The strong support that we have received from both the federal and provincial governments is very important because it allows us to give these initiatives priority and helps to secure our production footprint in Canada," said Ray Tanguay, chairman of Toyota Motor Manufacturing Canada.

The investment, called Project Green Light, will help to make the plants more efficient and environmentally friendly.

Measures include upgrading the paint shop at the Cambridge North plant to allow it to switch to a water-borne system from a solvent-borne system, resulting in lower emissions.

The deal with Toyota is the governments' first major investment in an automaker since they spent about C$13 billion to help bail out Chrysler LLC and General Motors during the auto sector crisis in 2008-09, the Globe and Mail newspaper said.

The federal government said its contribution is repayable.

(Reporting by Nicole Mordant and Euan Rocha, editing by Gerald E. McCormick and Peter Galloway)

 
<p>A visitor is reflected on a Toyota vehicle at the company's showroom in Tokyo June 17, 2011. REUTERS/Toru Hanai</p>