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Abu Dhabi, UAEWednesday 14 November 2018

Brexit boost for PM May as Toyota commits to building new Auris car in UK

The Japanese carmaker will make its new Auris hatchback at Burnaston, Derbyshire

A Toyota Auris is displayed on show at the Toyota factory in Derby, central England. REUTERS/Darren Staples
A Toyota Auris is displayed on show at the Toyota factory in Derby, central England. REUTERS/Darren Staples

Toyota said on Wednesday it will build the next generation of its Auris car in England in a welcome boost to Prime Minister Theresa May as the UK heads towards Brexit.

The Japanese carmaker will make its new Auris hatchback at Burnaston, Derbyshire, replacing the current run of the model made there, the company said in a statement.

Carmakers Toyota, Nissan and Honda have invested billions in Britain since the 1980s with most cars manufactured in the UK exported to the European Union. The three manufacturers make around half of the 1.67 million cars built in the UK.

But Britain’s decision to leave the world’s largest trading bloc has sent jitters through the industry because of concerns of the likely end of frictionless trade and the potential for new tariff barriers.

Executives from the three carmakers met Mrs May at the start of February to raise concerns over the impact of Brexit and to highlight the importance of securing a transitional Brexit deal to ease the introduction of new trading conditions.

In its statement on Wednesday, Toyota reiterated that free trade is very important for the future.

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"With around 85 percent of our UK vehicle production exported to European markets, continued free and frictionless trade between the UK and Europe will be vital for future success," said Toyota Europe President and CEO Johan van Zyl.

Business minister Greg Clark hailed the announcement and said Britain's automotive sector was one of the most productive in the world, adding "this government will continue work to create the best possible environment."

Toyota's Burnaston plant churned out 144,000 models last year, down 20 percent from 2016 according to industry data, as its current line-up of models neared the end of their product life cycle.

Nearly one in five of those cars were Avensis models, according to a source familiar with the situation. The firm did not comment on the future of the model in its statement on Wednesday. A spokesman did not immediately respond to a phone call and email requesting comment on the matter.