The province of Ontario, Canada is partnering with Mitsui High-tec to build the company’s first manufacturing facility in North America, and the very first facility in Ontario producing motor cores for electric and hybrid vehicles.

Ontario will invest up to $2 million to support Mitsu High-tec’s new facility in Brantford, of an overall project investment of about $38 million. The funds will be allocated from Ontario’s Jobs and Prosperity Fund, which will be providing $2.7 billion over 10 years to enhance productivity, bolster innovation, and grow Ontario’s exports.

The Japanese company chose Ontario because of the province’s highly-skilled workforce and strong auto sector, according to Brad Duguid, Ontario’s Minister of Economic Development, Employment and Infrastructure.

“Hybrid and plug-in technologies are becoming increasingly important as automakers adapt their fleets to meet more stringent fuel efficiency standards,” he said. “Ontario’s investment with Mitsui High-tec focuses on the next generation of vehicles, pushing Ontario’s auto sector to continue leading and competing globally.”

The greenfield facility is expected to begin production in early 2017 and will feature Mitsui’s advanced manufacturing techniques to produce high-efficiency motor cores. The partnership will secure 48 new highly skilled jobs and strengthen the province’s auto supply chain.

Initially, the Ontario plant will export the motor cores for electric and hybrid vehicles to customers in the United States with longer term plans to grow the company’s market share with Ontario-based vehicle assembly plants as well.

Ontario is one of the top locations in North America for vehicle production and the only province or state to have five major global automotive assemblers: Chrysler, Ford, General Motors, Honda and Toyota, as well as truck manufacturer Hino. The auto industry contributes around $16 billion annually to Ontario’s GDP.

Ontario’s five-year, $400-million Business Growth Initiative is helping to grow an innovation-based economy, helping small companies scale-up and modernizing regulations for businesses. As part of that initiative, Ontario announced the Automotive Supplier Competitiveness Program to help smaller auto parts companies adopt the latest technologies, plus support for the Canadian Urban Transit Research and Innovation Consortium to support R&D and commercialization of technologies.