Toyota plans to increase U.S. hybrid production to meet what the automaker says is strong demand for the vehicles.

The automaker recently announced a new assembly line at its Georgetown, Kentucky, plant for 2.4-liter turbocharged and 2.5-liter naturally aspirated inline-4 engines used in hybrid powertrains for both the Toyota and Lexus brands.

Representing a $145 million investment, the line will be able to produce three different engine types simultaneously, according to a Toyota press release, making the Kentucky plant the only Toyota assembly plant in North America with this capability. Toyota said the plant supplies engines to six of its seven North American vehicle assembly plants.

2024 Toyota Tacoma Limited2024 Toyota Tacoma Limited

The Georgetown complex is also scheduled to start producing hydrogen fuel-cell modules later this year. A report earlier this year said Toyota might also start EV production in Kentucky in 2025. For now, though, hybrids are the focus.

Among the vehicles using the 2.4-liter turbo-4 is the redesigned 2024 Toyota Tacoma hybrid. Revealed this week, the mid-size pickup truck’s so-called i-Force Max hybrid variants are the most powerful, reflecting Toyota’s decision to position the hybrid powertrain as an alternative to a larger engine, rather than a play at overall high fuel economy.

Toyota became synonymous with hybrids thanks to the Prius, and customer interest in them has remained strong. Owners of Toyota hybrid models keep their vehicles for a long time, because of their proven longevity and reliability, a 2020 report found.

Toyota engine assembly in Georgetown, KentuckyToyota engine assembly in Georgetown, Kentucky

Toyota has also expanded use of hybrid powertrains across its lineup. The Sienna minivan, Crown sedan, and Venza crossover are now all-hybrid, though the Sienna is the only one of those that’s U.S.-built.

With Toyota’s last comprehensive update on how it sees the U.S. market shifting toward electrification, it still saw 85% of its sales being of vehicles with tailpipes by the end of the decade—with 30% of the lineup by then still without any form of electrification. So a flexible engine assembly line like the one coming online in Kentucky is in keeping with the automaker’s forecasts.

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