LONDON, ONT. - Toyota continues to add jobs and production to its Canadian plants, making it the country's fastest growing automotive manufacturer.
Toyota announced Tuesday it will start making Canada's first hybrid electric vehicle in 2014 and add 400 jobs.
The move vaults the company to the upper echelon of automotive employers in Canada, and unlike the Detroit Three, Toyota is growing, said Tony Faria, automotive analyst and business professor at the University of Windsor.
"This will make them bigger than Ford" and about the same size as GM, he said.
"While the Canadian dollar is high, the yen is even stronger and the cost of building vehicles in Japan is way too high. They are moving a lot of assembly to North America right now."
And Southwestern Ontario is benefiting.
In March, Toyota announced it's expanding the workforce at its Woodstock RAV4 plant by 400, meaning the automaker will hire 800 workers this year, swelling its ranks at both plants to 7,300 by 2014.
This comes on the heels of Ford closing its St. Thomas assembly plant. GM also is closing one of its Oshawa plants.
"Right now (Toyota) cannot make money on a vehicle built in Japan and shipped to North America," Faria said.
The company also likes the quality and productivity of the Canadian workforce, and that has helped increase production, even though Canada remains a high-cost region, he said.
"Canada does offer some natural advantages. We have a productive, high quality, well-trained workforce. The quality has always been good in Canada."
Toyota's Canadian plants always score well in quality studies, Faria said.
The new jobs at the company's Cambridge plant will help the automaker increase production of the Lexus luxury crossover utility vehicle.
Annual output will increase by 30,000 from the current level of 104,000, including 15,000 RX450h, the hybrid version of the Lexus CUV.
"With this (investment) we are going to make greener vehicles," said Brian Krinock, president Toyota Motor Manufacturing Canada.
"Globally our commitment is to produce vehicles where they are sold and this has not changed. There is demand in North America for a hybrid. We see a natural opportunity to grow our market share."
Toyota's investment is more a case of opportunity offered in Canada, than needing to shift production out of Japan, Krinock said.
"Ontario is a high-cost region but we look at other factors, too, as well as cost, such as availability of parts and components, logistics, ability to improve the organization through quality and efficiency, and all these things make Canada a great place to do business."
Toyota's Cambridge plant is the only plant outside Japan assembling the Lexus. The new production will begin in 2014.
The growing production means Toyota will manufacture more than 500,000 vehicles in Cambridge, and employ 7,300.
The Cambridge plant also manufactures the Corolla, Matrix and Lexus RX 350 vehicles. The RAV4 is manufactured at Toyota's Woodstock plant.