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Toyota halts U.S. Prius project

Lindsay Chappell

NASHVILLE — Toyota Motor Corp., with its sales plunging in the United States, is freezing its plan to build the Toyota Prius in a new plant near Tupelo, Miss. For how long? The automaker doesn’t know.

Toyota’s board in Japan reached the decision late today to halt the project “due to the steep decline” in U.S. sales.

Sales of the hybrid car have softened in recent weeks as gasoline prices dropped from a summer spike of more than $4 a gallon. The Prius sold 8,660 units in November, down from 16,737 in November 2007.

Total Toyota sales in the United States fell 32 percent in November.

This is the second time Toyota has changed plans on the $1.3 billion Mississippi project, which already has begun to draw component suppliers to the area.

In February 2007, Toyota announced it would spend $1.3 billion there to produce a new generation of Highlander crossovers. But after Toyota broke ground, SUV sales began to soften. In July of this year, Toyota said it instead would build the Prius there.

A spokeswoman for Toyota’s North American manufacturing operations says the company will continue constructing the building, which is about 90 percent complete. The company made its decision today before it had begun ordering the equipment that would go into the plant.

Toyota has no timetable to resume the project, the spokeswoman says, but it will remain a Prius factory whenever the project restarts. …

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