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The BBC's Industry Correspondent, Stephen Evans
"It has been a bleak year for the industry in Britain"
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Toyota Senior Director, Bryan Jackson
"What we are trying to do is survive in a very difficult period"
 real 56k

Cardiff Business School, Garel Rhys
"It shows that actions speak louder than words"
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Thursday, 4 January, 2001, 11:20 GMT
Toyota to increase UK production
The Toyota Corolla
UK production of the Toyota Corolla will be boosted
Toyota has decided to increase vehicle production in the UK by almost a third, giving a much needed boost to the country's hard-pressed car industry.

"We are committed to the UK and we have a long-term future here," Bryan Jackson, senior director in the UK, said in an interview on BBC Radio 4's Today programme.

The Japanese car giant is to take on an extra 300 workers at its factories in Burnaston, Derbyshire, and Deeside, Flintshire in North Wales.

While this decision seems to fly in the face of what other manufacturers may be doing, we have looked at what is best for Toyota

Toyota spokesman
The move comes despite warnings from several Japanese manufacturers, including Nissan and Matsushita, that they might have to pull out of the UK if the country does not adopt the single European currency.

Last year Toyota told all its suppliers to settle their bills in euros to "minimise its currency risk exposure".

"Survival plan"

Toyota is to increase UK production of its Corolla model from the current level of 170,000 cars to 220,000 vehicles per year.

"While this decision seems to fly in the face of what other manufacturers may be doing, we have looked at what is best for Toyota."

"It reflects the faith our parent company has in the UK operation," a Toyota spokesman told BBC News Online.

Mr Jackson said this was not a new investment, but rather a way for Toyota to better utilise its UK capacity.

Toyota car production
Toyota is the third biggest car manufacturer in the world

"It is good news - but it is not the end of our problems," said the Toyota spokesman.

"The problems that exist economically are still there. This will help to mitigate them," he added.

Toyota employs 2,500 people in the UK. The majority of the new jobs will go to Derbyshire, with about 50 being created in Scotland.

The switching of Corolla production from Japan is aimed at countering extreme market conditions facing car manufacturers in the UK.

The announcement means the three-door version of the Corolla will be built alongside the five-door version, which is already in production at Burnaston.

European strategy

Toshio Mizushima, managing director of Toyota UK, said the announcement was positive news for the company and confirmed faith in the UK operation as a "vital and fundamental" part of the firm's European strategy.

Mr Mizushima said he believed the announcement would help alleviate the economic impact caused by the strength of the pound against the weakness of the euro.

Burnaston, which was the second most productive car plant in Europe in 1999, exports about 80% of its cars.

The switch in production means existing capacity will be maximised but Toyota said the move would not allow its UK operation to become profitable.

The Japanese firm, the third biggest car maker in the world, lost 52m in the UK in the financial year to 1999.

Sir Ken Jackson, general secretary of the Amalgamated Engineering and Electrical Union, said: "In the current climate facing car manufacturers this is very welcome news and represents a vote of confidence in Toyota's UK workforce."

Toyota Bank?

In a separate development, Toyota is reportedly seeking to diversify from its core business as a car producer and buy a stake in a new bank as part of its strategy to focus more on its finance business.

The car maker already offers its customers credit cards.

A small stake in the new bank, due to be launched by a major Japanese retailer, would enable the credit card customers to withdraw and deposit money at the bank's branches, according to a report in the newspaper Yomiuri Shimbun.

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04 Jan 01 | Business
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