April 29, 2019 / 5:03 PM / 4 months ago

Toyota to produce Lexus NX for North America at Canada plant

OTTAWA/MONTREAL (Reuters) - Toyota Motor Corp will build its Lexus NX luxury crossover vehicle at a Canadian plant starting in 2022, the company said on Monday, a decision that Prime Minister Justin Trudeau said demonstrated the value of the country’s international trade agreements.

FILE PHOTO: A Toyota logo is displayed at the 89th Geneva International Motor Show in Geneva, Switzerland March 5, 2019. REUTERS/Pierre Albouy/File Photo

The plant will invest hundreds of millions of dollars to produce the Lexus NX and its hybrid version at the factory in Cambridge, Ontario, “supplying the entire North American market”, Trudeau said in a presentation with Fred Volf, president of Toyota’s Canadian unit.

Citing Canada’s trade agreements with Mexico, the United States, Europe and Asia, Trudeau said: “We have preferential trade access to two-thirds of the global economy. In fact, we’re the only G7 country that has free trade deals with every other G7 country.”

Trudeau, who faces a tough re-election contest in October, said the plans by Toyota, one of the world’s largest carmakers, will help guarantee 8,000 jobs and the factory.

This is the first time that the Lexus NX and NX hybrid sport utility vehicles will be produced outside of Japan. The automotive sector is Canada’s largest export industry, supporting over 525,000 jobs, the prime minister’s office said, and Toyota is the country’s largest automotive manufacturer.

The announcement is a “counter narrative” for Canada’s automaking industry following recent bad news from other automakers, said Flavio Volpe, president of the Toronto-based Automotive Parts Manufacturers’ Association, especially in the province of Ontario.

Fiat Chrysler Automobiles NV said in March it would cut a shift at its Windsor assembly plant, leading to 1,500 job losses, and General Motors Co said last year it would shut its Oshawa factory by the end of 2019.

Plans to assemble the NX in Canada “means that Toyota’s Canadian manufacturing operations are here to stay,” Volf said, adding that the cars are “the most technologically advanced and the most in-demand cars in Toyota-Lexus global lineup.”

On Sunday, Trudeau hosted Japanese Prime Minister Shinzo Abe in Ottawa. Both touted the benefits of a Pacific trade deal that U.S. President Donald Trump walked away from.

Trudeau said he had discussed the project to build the Lexus NX in Canada with Chief Executive Akio Toyoda on April 1.

“When we last chatted just a few weeks ago, we discussed the potential of this new Lexus mandate,” Trudeau said.

Reporting by Allison Lampert in Montreal and Steve Scherer in Ottawa; editing by Richard, Sonya Hepinstall and Sandra Maler

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