Toyota Motor is thinking about building a new assembly plant in Japan, its first plant in the domestic market for nearly 20 years, company president Katsuaki Watanabe told reporters there on Tuesday.

Last week, Kyodo News, citing anonymous sources, had reported that Toyota is considering Japan's northernmost island of Hokkaido or the northern region of the main island as possible sites for the new plant.

According to the Associated Press (AP), Toyota officials have said Japan is often the best place to make certain models, such as luxury models and hybrids.

Honda Motor recently announced plans for its first new plant in Japan in 30 years - the car assembly and engine facilities will be running by 2010.

Toyota has already announced a new line next year at a plant in southwestern Japan to double production of engines for luxury models, AP added.

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