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Toyota will invest £240m in upgrading its UK car plant, in a sign the Japanese carmaker will remain committed to manufacturing in Britain after the country’s departure from the EU.

The move is supported by an investment of up to £21.3m from the UK Government, which has pledged to do all it can to maintain the competitiveness of Britain’s automotive sector during and after Brexit.

Around three quarters of the cars Toyota produces at its Burnaston facility are exported to the EU, while the company is also heavily dependent on the single market for components that go into its vehicles.

The decision is a vote of confidence in the UK’s car industry, and comes after Nissan pledged to make new vehicles in Britain in spite of the uncertainty cast by the result of the Brexit vote.

Nissan’s decision was made after the group was offered assurances by the UK government the trading conditions at its plant would not change following the Britain’s departure.

Toyota’s European president Johan van Zyl said:

We are very focused on securing the global competitiveness of our European plants.

This upgrade of is a sign of confidence in our employees and suppliers and their focus on superior quality and greater efficiency. We welcome the UK Government funding contribution for this activity.

Our investment demonstrates that, as a company, we are doing all we can to raise the competitiveness of our Burnaston plant in Derbyshire. Continued tariff-and- barrier free market access between the UK and Europe that is predictable and uncomplicated will be vital for future success.

The UK car industry has warned that losing access to the single market and customs union will hurt its competitiveness.

In the event of a “hard Brexit” that sees the UK fall back to World Trade Organisation rules, exported cars will face a tariff of 10 per cent, while imported car parts will face a smaller levy of 2-4.5 per cent.

Funding from the Government for Toyota will promote training, research and development and further enhancements of the plant’s environmental performance.

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