Rav4 production at Toyota's Woodstock plant.
Toyota Motor Corp. will assemble the electric version of the RAV4 at its plant in Woodstock, Ont., helping the province nab a slice of the burgeoning market for battery-powered vehicles.
Premier Dalton McGuinty plans to visit the auto maker's Woodstock plant on Friday, where he will announce that the province has landed the electric vehicle assembly project, a government official said.
The federal and provincial governments are financially backstopping a $545-million investment Toyota is making in its plants in Ontario to help them land new auto production. Toyota already assembles the RAV4 crossover utility vehicle in Woodstock for the North American market.
Toyota Motor Manufacturing Canada Inc. received a $71-million loan from Ottawa and a matching grant from Ontario, representing about 26 per cent of the investment the company is making in its plants in Woodbridge and Cambridge to finance production improvements and green initiatives.
The government official said the province's grant will help Toyota retain the 6,500 jobs at its plants in Woodstock and Cambridge. It will also help to burnish the governing Liberals' track record for supporting the all-important auto sector in the lead-up to the provincial election in October.
"Every U.S. state and Canadian province would want to be home to electric vehicle manufacturing," the government official said. "Toyota chose Ontario. It confirms we're on the right track."
Although the market for vehicles powered by electricity is expected to be small in the short and medium term, auto makers are spending billions of dollars to develop them. Ontario, which produces more vehicles than any other province or state in North America, is fighting to win a share of the investment. The McGuinty government offers incentives of up to $8,500 for buyers of electric vehicles, with an eye on boosting demand.
The financial assistance from Ottawa and Ontario represents their first major financial contribution to an auto maker since they spent about $13-billion to help bail out Chrysler LLC and General Motors Corp. in 2008 during the recession that led to the auto industry crisis.
Toyota officials unveiled the electric version of the RAV4 at the Los Angeles International Auto Show last November. It will go on sale next year.
Tesla Motors Inc. of Palo Alto, Calif., is designing and developing the major electric components of the vehicle. Final assembly will be done in Woodstock.