By Naomi Tajitsu and David Shepardson
TOKYO/WASHINGTON (Reuters) - Toyota Motor Corp (T:7203) on Tuesday said it would add 400 jobs to build more SUVs at one of its U.S. plants, highlighting its expansion plans just as U.S. President Donald Trump calls on manufacturers to build more cars in the country.
The Japanese automaker said the jobs were part of a $600 million upgrade of its plant in Princeton, Indiana, and were included in its plans announced earlier this month to invest $10 billion in its U.S. operations over the next five years.
The announcement comes as Trump focuses on protectionist trade policies during his administrations' first week, including a formal withdrawal of the United States from the Trans-Pacific Partnership trade deal on Monday.
The president has previously favored a 35 percent tariff on imported vehicles and pledged to renegotiate the North American Free Trade Agreement with Mexico and Canada to promote a "buy American and hire American" policy.
He has also criticized automakers including Toyota for producing cars in neighboring Mexico for export to the United States and on Tuesday will have breakfast with the chief executives of General Motors Co (N:GM), Ford Motor Co (N:F) and Fiat Chrysler Automobiles
Toyota last year produced around 1.4 million vehicles in the United States, its largest market. It operates 10 factories in the country, including the plant in Indiana which new Vice President Mike Pence visited while he was state governor.
The automaker also operates a pickup truck assembly plant in Mexico, and is constructing a second site in the country, where it plans to build the Corolla sedan.
Earlier this month, Trump in a tweet said Toyota could be subject to a "big border tax" if it went ahead with plans to build the Mexico plant, which the automaker announced in 2015. Toyota has said its mid-term investment plans are not a response to Trump's remarks.
Like many automakers, Toyota has been ramping up production of sport utility vehicles (SUVs) in the United States as low fuel prices spur demand for larger cars.
It said the Indiana investment would increase production of its Highlander SUVs by an annual 40,000 vehicles from the second half of 2019, or around 17 percent from 2016 levels. The new jobs would add to the plant's existing production line, which operates two shifts.
Of the 10 U.S. Toyota plants, five assemble vehicles, and the Indiana plant is the second-largest of the assembly sites. It currently employs 5,100 people and last year produced around 402,000 vehicles.