US President Donald Trump has described a decision by Japanese automakers Toyota and Mazda to build a new car plant stateside as "a great investment" in American manufacturing.

On Friday (4 August), the Japanese car giants said they will join forces to invest $1.6bn (£1.23bn) in the plant with a capacity to produce 300,000 units a year, and generate employment for up to 4,000 people.

Toyota currently has a 5% stake in Mazda.

Earlier in the year, Trump - who had campaigned for the White House on promises to increase manufacturing and expand employment for American workers - criticised Toyota's plan to manufacture its Corolla model at a new $1bn plant currently under construction in Mexico.

The President had also said Toyota would face hefty tariffs for cars built in Mexico if it exported them to the US.

However, Toyota now says the said production will shift to the US. The company's Mexico plant will produce its Tacoma truck model instead.

Responding to the announcement, Trump tweeted: "Toyota & Mazda to build a new $1.6b plant here in the U.S.A. and create 4K new American jobs. A great investment in American manufacturing!"

Alongside Toyota's assembly line, a new Mazda Sports Utility Vehicle (SUV) will also be made at the proposed US factory, with the two companies hoping production will begin in 2021. At the moment, Mazda ships all vehicles sold in the US from plants in Japan and Mexico.

Both parties would also be cooperating on electric vehicles. The location of the US plant has not been made public yet.