Huntsville Mayor Tommy Battle said the plant will "provide jobs for decades to come for Huntsville and Alabama".
"Great news as Toyota and Mazda announce they are bringing 4,000 JOBS and investing $1.6 BILLION in Alabama, helping to further grow our economy!"
The decision to pick Alabama is another example of foreign-based automakers building US factories in the South. Toyota and Mazda, thank you so much.
The State of Alabama is the fifth largest producer of cars and light trucks nationally with a strong automotive manufacturing presence including Toyota's engine plant in Huntsville, where Toyota employs 1,400 team members.
Alabama was tied with Tennessee as the fifth-largest producer of vehicles in the country previous year, according to the Center for Automotive Research, an industry think tank in Ann Arbor, Michigan.
"Alabama won a first place trophy today in being selected for that plant", said Dave Sullivan, product analysis manager at AutoPacific Inc., an automotive research company. The plan for the Alabama plant appears to reflect Trump's calls for more investment and jobs in the United States.
Several states had competed for the coveted project, which will be able to turn out 300,000 vehicles per year and will produce the Toyota Corolla compact auto for North America and a new small SUV from Mazda. USA new vehicle sales fell 2 percent in 2017, after hitting an all-time record high in 2016, and are expected to fall further in 2018.
USA sales of small cars fell almost 10 percent previous year as buyers continued a massive shift toward SUVs and pickup trucks. Toyota said it would shift production of Corollas from Canada to the new venture rather than in Guanajuato, and would build Tacoma pickups in Mexico instead.
Mazda and Toyota said they still need approvals and authorization by antitrust agencies for the new joint venture.
Trump praised the joint venture announcement, saying in August on Twitter: "Toyota & Mazda to build a new $1.6B plant here in the United States of America and create 4K new American jobs".
President Donald Trump had criticized Toyota for taking auto production and jobs to Mexico.
A Toyota spokesman declined to comment, except to say an announcement was expected soon.
In October, Toyota said it would scale back investment in a planned plant in Mexico by 30 percent to $700 million and cut planned annual capacity in half to 100,000 vehicles as it shuffles its production plans to meet market demands.
The plant is expected to open in 2021 and produce 300,000 vehicles a year.
USA states covet auto assembly plants because they typically pay above-average wages and spin off jobs at suppliers and service companies.
Alabama started on the road to becoming an auto manufacturing hub in 1993 when Mercedes chose it as the location for a manufacturing plant after the state offered a then-eye popping $250 million incentive package. These states generally have good transportation infrastructure, business-friendly regulators and anti-union politicians.