The facility, to be located in Woodstock, will make Toyota’s RAV4 sport utility vehicle. It is scheduled to open in 2008 with the capacity to build 100,000 units a year.

Toyota has been manufacturing vehicles in nearby Cambridge since November 1988. The original capacity was 50,000 units annually. By 2004, production had climbed to 288,000 units and the facility now employs 4300 people.

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The Waterloo Region, which includes the cities of Cambridge, Kitchener and Waterloo and is known as Canada’s Technology Triangle, is already home to many Toyota suppliers.

Toyota also announced a $31.6m expansion of Canadian Autoparts Toyota, Inc (CAPTIN) in Delta, British Columbia. As a result, wheel capacity at Delta will increase by nearly 17% a year, from July 2007.