Lexus ES350 confirmed for Kentucky production starting in 2015

Fri, 19 Apr 2013

Following Thursday's report, Toyota has confirmed that production of the Lexus ES will move to its Georgetown, KY assembly plant starting in 2015. To accommodate the extra 50,000 units of capacity that the ES represents, Toyota will be investing $360 million in the plant and hiring 750 new workers.

In the previous report, sources stated that the state of Kentucky had offered Toyota as much as $146.5 million to move ES production to the Georgetown facility.

The press release, posted below, specifies that only the ES350 will be built in Kentucky, so it's likely that the ES300h hybrid will continue to be built in Japan – where all ES models have been built since the car was introduced in 1989. Toyota's Georgetown plant, which currently builds the Toyota Camry, will also be getting an expansion to its engine plant to produce more four-cylinder engines at a cost of $30 million and will create an additional 80 jobs.

Toyota to Build Lexus ES 350 at Its Georgetown, Kentucky Plant

Investing $360 million and creating 750 new jobs to produce 50,000 vehicles annually starting in 2015

Latest in series of investments totaling $2 billion over last 17 months to expand North American production and create more than 4,000 new jobs

Erlanger, KY, April 19, 2013 – For the first time, a Lexus vehicle will be produced in the United States. The Lexus ES 350 will be assembled at Toyota Motor Manufacturing, Kentucky (TMMK) in 2015, Toyota announced today.

The move will generate 750 new jobs. To support the new dedicated assembly line, Toyota will invest $360 million in the Georgetown plant.

About 50,000 Lexus vehicles a year will be produced, bringing the plant's total annual production capacity to more than 550,000 vehicles. It will be the first time the ES will be assembled outside of Japan.

"Lexus was founded in the United States, so it is only fitting that we are bringing the production of luxury sedans for our U.S. customers back to where the brand was born," said Akio Toyoda, president of Toyota Motor Corporation. "Today's announcement is a major step in our Global Vision to make ever better cars and trucks, give regions greater autonomy to make the products their customers want and achieve sustainable growth globally."

"Since its arrival here in 1986, the impact Toyota has had on Kentucky has been immeasurable, and the addition of Lexus production only adds to that enduring legacy," said Governor Steven Beshear of the Commonwealth of Kentucky. "The establishment of production for the Lexus ES 350 will afford Kentucky a tremendous opportunity to expand and strengthen its vast supplier base, creating even more growth potential in the future. Kentucky is proud of the confidence Toyota continues to demonstrate in our vibrant and skilled workforce as they prepare to make a vehicle model that, like them, has earned a reputation for high quality."

Production of the ES 350 at the Georgetown plant is the latest step in Toyota's continuing strategy to assemble vehicles in the markets where its customers live. Over the past 17 months, the company has announced plans to increase production capacity at its plants in Mississippi, Indiana, West Virginia and Canada, reflecting a cumulative investment of approximately $2 billion that has created more than 4,000 new jobs. Toyota also recently announced executive changes designed to provide regional managers with more local control and a streamlined decision-making structure to help the company deliver superior customer-focused products and services.

"Today's Lexus ES announcement further strengthens Toyota's commitment to serving American consumers, growing American production and investing in American team members," said Jim Lentz, Toyota's chief executive officer for North America. "We're extraordinarily proud to have helped create over 365,000 jobs across the country and to produce so many of the industry's highest quality vehicles right here in the United States. Today, Toyota's 14 North American plants already produce seven out of every 10 vehicles that we sell in America, and North American-assembled vehicles are now exported to 23 countries around the world."

Established in January 1986, TMMK is Toyota's largest manufacturing facility outside of Japan, employing approximately 6,600 people. The plant currently assembles the Toyota Camry, Camry Hybrid, Avalon, Avalon Hybrid and Venza and manufactures 4-cylinder and V6 engines. It has earned 10 Initial Quality Plant Awards from J.D. Power and Associates, including four gold J.D. Power Awards.

In 2012, the plant produced the 25 millionth Toyota vehicle built in North America. Toyota recently committed to boosting production capacity for the 4-cylinder engine at the plant by more than 100,000 units. This $30 million project will create about 80 new jobs.

"The decision to move ES 350 production to Kentucky is a true tribute to the hard work and commitment to excellence of every single Toyota team member at this plant," said TMMK President Wil James. "We deeply appreciate the tremendous support we have received from our community, from our local suppliers and business partners, and from Governor Beshear and the Commonwealth of Kentucky. We look forward to strengthening further the productive partnership we have built together over the last 25 years."

The ES is Lexus's bestselling sedan, with approximately 58,850 vehicles sold in North America in 2012 -- including 56,158 in the U.S. Projections for Toyota's production volume at the company's Kyushu plant in Japan have not changed. The company remains committed to building 3 million vehicles per year in Japan, including Lexus models, as previously announced.

Toyoda and Lentz made the Lexus ES 350 production announcement at a press conference prior to a major New York City event showcasing Lexus's commitment to groundbreaking design and its redoubled focus on creating a global luxury brand experience.

By Jeffrey N. Ross