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New PSA-Toyota platform gets green light for 2005

Toyota and PSA Peugeot Citroen will begin joint production of their new small car at a new factory in the Czech Republic in 2005.

The venture will combine PSA's European purchasing power with Toyota's production line techniques. Under the banner of Toyota Peugeot Citroen Automobile Czech (TPCA), the plant will manufacture up to 300,000 cars a year for the European market.

The Kolin facility represents a 1.5bn Euros (£923m) investment with development costs shared between the two manufacturers. PSA will pick up two-thirds of the bill for future costs, reflecting the amount of cars it expects to take.

Located 60km east of Prague, the new 120-hectare site will provide Toyota with an important base for its European operations. Original equipment manufacturers have been allocated an area to install production facilities near the plant.

The venture will play a vital role in helping the Japanese carmaker return to profitability in Europe.

“It is no exaggeration to say that the success of this project is the key to Toyota's future success in the European market,” says Fujio Cho, president of the Toyota Motor Corporation. Car production at Kolin will start in 2005. Of the 300,000 units produced every year, PSA will take 200,000 cars, leaving Toyota with 100,000. First vehicle off the production line will be smaller than Peugeot's 106 or Toyota's Yaris.

The new car is likely to use the PSA 1.4-litre HDi engine and Toyota's new 1.0-litre petrol engine, which is being built at Toyota's new engine plant in Poland. Both manufacturers stress they will remain in competition. Toyota's Masatake Enomot has been appointed president of TPCA. Jacques de Raismes, from PSA, is vice-president.

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