In announcing a £60m expansion programme for its UK operations last week, Toyota would not be drawn on where it will locate its planned small-car plant, something it is expected to announce in mid-1998.
Toyota wants to increase its European sales to 600,000 units by 2000, either through expansion in the UK or by building plant in France or Poland.
The plans were revealed as Hiroshi Okuda, Toyota Motor Corporation president, said the company would invest £60m on equipping its engine plant at Deeside, North Wales, to take capacity to 200,000 units a year. This will allow the plant to assemble increased volumes and add to its machining capability.
The announcement had been delayed pending the general election result.
Okuda also confirmed that Toyota would double manufacturing capacity at Burnaston, Derby, to 220,00 cars a year to cope with the introduction of the Corolla this summer, following a £200m investment.
The company will add production of the Corolla five-door liftback model to the Carina E being built at Burnaston.
The planned increases will have a knock-on effect on Toyota’s European suppliers, with which the company spends £500m a year on 200 parts, components and raw materials. This will rise to £880m at 200,000 capacity and almost £1bn at 220,000 capacity.
Employment in the UK should increase from 2,450 to 3,000.
A Honda spokesman this week contradicted rumours that the company wanted to open a second European plant by 2001, in France, Germany or Spain.
Honda is already investing in its Swindon plant to expand annual production from 100,000 to 150,000 vehicles by 1998.