Mazda to produce car for Toyota at Mexico plant
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TOKYO -- Mazda Motor Corp. will produce a subcompact car for Toyota Motor Corp. at its new Mexican assembly plant starting in 2015, as the automakers seek ways to boost North American output.
The Toyota vehicle will be a rebadged version of the Mazda2 targeting the U.S., Canadian and Mexican markets.
Production will start in the summer of 2015 at an annual pace of 50,000 vehicles, the companies said in a statement today.
The volume would come on top of the 140,000 capacity already planned for Mazda vehicles at the plant, Mazda spokesman Greg Young said. The automaker's factory in Salamanca is scheduled to open in 2014 and build the Mazda2 and Mazda3 small sedans. Mazda's plans to export those cars to the United States remain in place.
Toyota will share the cost of increasing the plant's capacity, Toyota spokesman Dion Corbett said separately. He declined to say how much the investment would be.
The agreement helps both companies as they look for ways to expand local production in North America and deflect the foreign exchange losses they book on importing cars from Japan.
Mazda this year ended production at its only U.S. plant, a joint venture with Ford in Flat Rock, Mich.
Mazda can generate better economies of scale from its plant, while Toyota gains extra local output without a major investment.
The rebadged Mazda2 will be based on the car but have distinct styling, Toyota's Corbett said. Production will likely coincide with the introduction of the next generation Mazda2.
The current generation Mazda2, which uses the same platform as the Ford Fiesta, debuted in 2007. It was unclear whether Toyota and Mazda would jointly develop the new car, as Mazda did with Ford when those companies had stronger strategic ties.
A Toyota source said that the plant will build a Toyota-badged vehicle.
Toyota markets the Yaris subcompact in the United States, suggesting the automaker may use Mazda's Mexico plant to build the next generation Yaris, which is due around 2015.
Currently, the Yaris, as well as all Scion models, are built in Japan, where the strong yen erodes or erases profits on small cars and other vehicles.
Toyota has already announced plans to shift output of the Yaris sold in North America from Japan to France, in large part to escape the punishing impact of the yen.
It will be the first time Toyota has imported a model built in Europe to North America.
The Scion xB and xD hatchbacks are made by Toyota subsidiary Toyota Motor East Japan. The U.S. spec Yaris is made at that company's plant in Miyagi, Japan.
Toyota and Mazda currently have no capital tie up. But Mazda chose to team with Toyota over Ford, in developing its own hybrid drivetrain. That system is set to debut next year.
The Toyota tie up is the latest outreach for Mazda, which is looking for joint projects following Ford's selldown of its longtime controlling share in the Japanese company.
In May, Mazda and the Fiat Group announced plans to develop and build a new roadster for the Mazda and Alfa Romeo brands.
The jointly developed car will be built at Mazda's factory in Hiroshima. It will be a successor to the rear-wheel-drive MX-5/Miata roadster and will have distinct styling for each brand.
Alfa will launch its version in 2015.
Mark Rechtin and David Phillips contributed to this report
You can reach Hans Greimel at hgreimel@crain.com. -- Follow Hans on 
