Toyota Motor Manufacturing Canada Inc. will spend $100-million to expand production of the Lexus RX350 luxury crossover utility vehicle in Cambridge, Ont.
The move will create 400 jobs as the Cambridge plant produces all RX350 vehicles for the North American market by 2014. At the moment, North America is supplied by both the Cambridge plant and a plant in Japan.
In addition, the Ontario plant will produce a hybrid version of the vehicle for the first time.
Lexus capacity will increase by 30,00 vehicles to 104,000 annually, including 15,000 hybrid versions.
"This is a big and ambitious project with new technology, exacting standards and tight timelines," Toyota Motor Canada president Brian Krinock said in a statement Tuesday.
Toyota and other Japan-based auto makers have been shifting production out of Japan to North America and other regions as the high value of the yen raises the cost of producing in their home country and cuts profits.
The increase in production combined with a boost in output of RAV4 models at Toyota's Woodstock, Ont., plant will increase the auto maker's production capacity in Canada to 500,000 vehicles annually, Mr. Krinock said in an interview.
The move requires modifications to the existing Cambridge facility, which also assembles the Corolla and Matrix compact vehicles.
"We are already maxed out in the facility," he said.
The investment in Woodstock will also add 400 workers, beginning next year, so total employment will grow to 7,300 people by early 2014.
The Cambridge plant is the only Toyota factory outside Japan that assembles vehicles for the auto maker's luxury Lexus division.