Peugeot, Toyota Will Jointly Produce Small Cars In The Czech Republic.(Brief Article)

Peugeot Citroen and Toyota Motor Corp. said that they have selected the Czech Republic as the site for a plant to jointly produce small cars for the European market. The automakers, which announced a 50-50 joint venture in July, said the plant will be located in Kolin, roughly 35 miles east of the capital, Prague.

Construction of the plant is expected to begin soon, and vehicle production is expected to start in 2005, the companies said. The plant is expected to produce both gasoline- and diesel-powered vehicles, with a capacity of 300,000 cars per year. They will be marketed under the Toyota, Peugeot and Citroen brands, the companies said.

Peugeot and Toyota said they selected the site for its proximity to major markets, industrial expertise in the Czech Republic, and availability of land and accessibility of transportation. The companies said they expect to invest some $1.3 billion in the project, including the costs for research, development and launch of the business.

The joint venture is part of a plan by Toyota, like other top Japanese automakers, to expand their share in the European market by localizing production and putting the focus on small cars.

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