Toyota to shift production of its performance car from Japan to the UK

Toyota plans to expand its car production in the UK to allow more North American enthusiasts to get their hands on its latest hot hatch, suggesting manufacturers are enjoying a Brexit boost amid Donald Trump 's trade war. The world's biggest car maker, worth about £200billion, will start moving some of its assembly for the GR Corolla performance model from its native Japan to the Burnaston plant in Derbyshire - once it sets up a dedicated production line.

Expected to start by mid 2026, experts say the Japanese company's move is a sign of Britain's attractiveness to firms deciding where to set up factories. The UK is 'well-placed to act as a bridge between the US and EU,' said Alex Altmann from business advisers Lubbock Fine, adding that Brexit allowed the UK to 'tailor its regulatory framework to better suit domestic industries'. A trade deal with the US to reduce tariffs from 25 per cent to 10 per cent for up to 100,000 UK-made cars per year also adds to the UK's desirability - and could mean other manufacturers will follow suit.

There's reportedly a sizable appetite for the 300hp GR Corolla in the US, and sources say that Toyota will use excess capacity in the UK to better supply the market and shorten wait time for customers over the pond. Two people familiar with the matter, who spoke anonymously to Reuters, said that Toyota will spend over £41million ($56m) on the assembly line dedicated to North American GR Corolla exports. The Trump administration agreed this month to cut tariffs on auto imports from Britain, however the sources said Toyota's move was not a reaction to the President's tariffs.

Japan is currently in line to be hit with the higher 25 per cent import levies due to be introduced on 9 July. Even though GR Corolla imports from the UK to US would likely pay a smaller import fee than they do currently from Japan, the two anonymous commenters insisted that the move has been sparked only by the fact Toyota had been unable to keep up with demand from petrolheads on the other side of the Atlantic.

The production line will be set up at the Derbyshire factory to produce 10,000 of the hot hatches per year and begin outputs from the middle of next year , according to the sources. Burnaston began operations in 1992 and already produces the normal hatchback and hybrid estate Corolla for UK and European markets.

Despite suffering a decline in manufacturing since Brexit, its advanced production technology and Corolla expertise make it a natural choice, one of the people said. Engineers will be temporarily dispatched from Japan to share production technology and other expertise as well. The 'GR factory' Motomachi plant in Japan assembled 25,000 cars last year, around a third of which are Corollas, but is reportedly at full capacity.

The shift to UK GR Corolla production also lends credence to the theory that the GR Corolla could launch in Europe soon. Currently it is only offered in a number of enthusiast markets including the US and Japan, but prototypes were spotted testing at the Nürburgring last year. Currently UK hot hatch fans have the GR Yaris but demand is so high that Toyota uses a ballot system.

In response to Reuters questions, Toyota said it was always looking for ways to optimise production, but that the report was not something the company had publicly announced. This is Money contacted Toyota UK, which has declined to comment.