Toyota may this month name the site in the southern United States for its eighth North American assembly plant, according to a report.

The Wall Street Journal (WSJ), citing people familiar with the matter, said the automaker is considering three to five locations, including Chattanooga, Tennessee, and Marion, Arkansas, according to Reuters.

Other sources reportedly told the paper that locations near Alamo, Tennessee, and in North Carolina also are possibilities.

The new plant would have annual manufacturing capacity of 200,000 vehicles and start production in 2009, sources told the WSJl.

It and other plants being built and ramped up would increase manufacturing capacity to about 2.2m vehicles a year, compared with 1.5m now, the paper said, according to Reuters.

The plant would likely produce the next-generation Toyota Highlander sport/utility vehicle and possibly a tall station wagon like the Chrysler Pacifica, the WSJ report said.

The wagon is called the Ace and is a replacement for the Toyota Solara, people familiar with the matter told the paper.

The move, which Toyota has been pondering for months, would show that Toyota will try to take more of the U.S. market from domestic rivals in the next several years, the WSJ reportedly said, adding it also would strengthen Toyota’s hand if a backlash against non-US brands arises from the increasing troubles of domestic automakers and their suppliers.

According to Reuters, the WSJ, citing sources, said Toyota likely would expand its existing engine-manufacturing facilities in the United States, most likely by expanding its engine plant in Alabama.

A decision on engine manufacturing expansion also will likely come before the end of the first quarter of 2007, the WSJ quoted sources as saying.