Motor Corp. reportedly will invest £110 million ($216 million) to produce a new engine at its plant in Deeside, Wales, U.K.
The Western Mail newspaper says the new locally built ZR engine will be used in theAuris hatchback, which went into production this week at the Burnaston, Derbyshire, assembly plant.
It replaces the Corolla both at the plant and in the European market. The Corolla had been in production at Burnaston since 1998.
The Deeside facility reportedly built 442,000 engines last year. It currently employs 697 people.
Toyota expects to sell 200,000 Auris hatchbacks annually worldwide, Reuters says, including 150,000 in Europe. The auto maker is projecting European sales of the car at 200,000 units in 2008.
The Auris bowed in Japan in October and goes on sale later this quarter in Europe.
Also produced in Turkey, the Auris will be offered as a 3- and 5-door with a choice of two gasoline and three diesel engines.