Donald Trump hails Toyota 'u-turn' on moving Corolla production to Mexico and plans for new US factory

The US President had previously attacked Toyota because it had planned to produce its Corolla model at a new plant in Mexico

On Friday, Mr Trump tweeted: 'Toyota & Mazda to build a new $1.6B plant here in the U.S.A. and create 4K new American jobs. A great investment in American manufacturing!' (Mark Wilson/Getty)

Donald Trump hailed an announcement by Toyota and Mazda that the two car companies would "explore" establishing a new plant as part of a joint venture that would produce vehicles in the United States, potentially creating 4,000 jobs.

The US President had previously attacked Toyota because it had planned to produce its Corolla model at a new plant in Mexico.

On Friday, Mr Trump tweeted: "Toyota & Mazda to build a new $1.6B plant here in the U.S.A. and create 4K new American jobs. A great investment in American manufacturing!"

The joint announcement from the two companies said they had agreed to enter a partnership but did not confirm that the proposed plant would be built, as the President's tweet suggested.

Toyota and Mazda said: "As part of the new alliance, Toyota and Mazda have agreed to explore establishing a joint venture plant in the US with equal funding contributions".

If the new facility were to be built it would have capacity to make around 300,000 cars a year.

Toyota and Mazda continued: "Pending approvals and authorisation by relevant government agencies, the companies will begin to examine detailed plans with the goal to starting operations of the new plant in 2021.

"The plant will require a total investment of approximately $1.6bn, and will create up to 4,000 jobs".

Toyota said it would not move Corolla production to its plant in Mexico, which is currently under construction, but it would instead make its Tacoma model there.

"There will be no substantial impact on Toyota’s investment and employment plan there," the Japanese car manufacturer said.

The plan is likely to be hailed as a victory for the President's "America first" trade policy. He threatened car companies with a "big border tax" if they chose to build cars in Mexico instead of the US.

Marking the agreement to enter a partnership with Mazda, Toyota president Akio Toyoda said: “This is a partnership in which those who are passionate about cars will work together to make ever-better cars. It is also the realisation of our desire to never let cars become commodities.”

Representing Mazda, president and chief executive Masamichi Kogai said: “Nothing would please me more than if, through this alliance, we can help to energise the auto industry and create more car fans by bringing together two competitive spirits to spur each other on, leading to innovations and fostering talent and leaders.”