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Toyota Will Build Prius Hybrid In New Plant in Mississippi

Reacting to a sales decline -- and a rare misreading of the market -- Toyota is speeding its decision to shuffle production sites for several vehicles and to bring assembly of the world's most popular hybrid, the Prius, to the United States. It will assemble the Prius at a plant it is building in Blue Springs, Miss., starting in 2010. It was to assemble the Toyota Highlander SUV there, but that car-based vehicle will instead be built in Princeton, Ind.

"It definitely makes sense to produce the vehicle here, which is the biggest market for the Prius," says Mike Omotoso, a senior manager at J.D. Power and Associates. The falling dollar also has lowered production costs in the United States.

"Toyota has not been that way in the past," says University of Michigan professor Jeffrey Liker. "They have been really good at forecasting the market." In June, Toyota's U.S. sales dropped 21.1% to 193,234 Toyota, Scion and Lexus vehicles.

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