London - Toyota will begin production of its first European-built full hybrid car in England in mid-2010, the government said on Thursday, in a boost to Britain's hopes of becoming a leading player in low carbon industry.
The Japanese carmaker will make a gasoline-electric version of its Auris hatchback at its factory near Derby, about 200km north of London, the Department for Business Innovation and Skills said in a statement.
"This is a welcome and forward-looking investment in Britain," Business Secretary Peter Mandelson said in a statement. "As part of our low carbon industrial strategy we set out to make Britain the best place in the world to develop low carbon vehicles."
The engines will be made at Toyota's factory in Deeside, north Wales. There were no details on the level of investment in the plants or the effect on staff numbers.
Toyota says the hybrid Auris uses 19% less fuel and emits 17% less carbon dioxide than the standard version.
It builds most of its hybrid vehicles in Japan, but also produces a small number of Prius cars in China and the Camry hybrid in the US.
Toyota Motor Europe's chief executive officer Tadashi Arashima said it was a "significant step forward in ensuring that full hybrids become more accessible to a wider range of customers".
Toyota has a goal of selling at least 1 million hybrid vehicles a year within the next few years.
The Auris, part of the popular Corolla series, was Toyota's third-best-selling model in Europe during the first five months of this year after the Yaris and Aygo subcompact models.
On Wednesday, Britain said it expects its low carbon sector, which includes the design and production of "green" cars, to be one of the few areas of the economy that will grow during the recession and beyond.