TUPELO, Miss. — Toyota Motor Corp.'s Highlander sport utility vehicle should start rolling off the assembly line at a new, $1.3 billion plant in northeast Mississippi by 2010, company and state officials said last week.

Toyota disclosed the site for its eighth vehicle assembly plant in North America, saying it will be built on a 1,700-acre site at Blue Springs, about 10 miles northwest of Tupelo. It also considered sites in neighboring Arkansas and Tennessee.

The Mississippi plant will manufacture 150,000 Highlanders a year. It also will create 2,000 badly needed jobs in an area with an economy that has slowed because of losses in furniture manufacturing positions.

Mississippi officials courted Toyota for 2 1/2 years, mostly out of the public eye.

"As Elvis would say, 'Only fools rush in,' " Ray Tanguay, executive vice president of Toyota Motor Engineering and Manufacturing North America Inc., said during the company's announcement at Tupelo High School.

Elvis Presley was born in Tupelo.

Toyota officials said the company chose to go to northeast Mississippi because they liked what they saw of the education levels and work ethic of potential employees.

Jim Wiseman, vice president of external affairs for Toyota North America, said more than 25 states sought the plant, and Tennessee and Arkansas had "excellent sites."

"You can't choose everybody," Wiseman said.

Officials in Arkansas and Tennessee sought to put the best face on finishing out of the money.

"Finishing second is not bad," Chattanooga Mayor Ron Littlefield said of Tuesday's announcement. "The important thing is the forward momentum has not stopped and will not stop."

In Arkansas, Marion Mayor Frank Fogleman said he was disappointed his town won't host Toyota. However, Fogleman said, he was talking with state economic development officials about other auto companies and other industries that may be interested in building in the region.

"We're not going to sit around and mope and be depressed," Fogleman said. "We're going to get busy and move forward."

The Mississippi site is mostly privately owned forest land now. Construction is expected to begin this fall, and the first vehicles are to roll off the assembly line in three years.

The plant will be the second automaker to locate in the state. Nissan Motor Corp. opened its assembly plant north of Jackson in 2003. The 4,000-employee plant produced about 278,000 vehicles last year.

Jim Press, president of Toyota North America, said Mississippi is offering the company a $296 million incentive package. That's less than the $363 million package Mississippi gave Nissan in 2000.

Toyota already has vehicle assembly plants in the United States, Canada and Mexico. Also, the company will start producing Camrys at a Subaru plant in Lafayette, Ind. Toyota also has four engine plants in North America.

Gov. Haley Barbour said Mississippi officials showed Toyota potential industrial sites near Tunica and Como in the north, near Meridian in the east and near Tupelo. He said company officials chose the site near Tupelo last summer, while still considering sites in other states.

Press said he met with Barbour and discussed Mississippi's response to Hurricane Katrina, which left a broad swath of destruction across the southern part of the state when it blew ashore 18 months ago.

"He described to me the character and the resiliency of the folks who were involved in the Katrina disaster, and it showed a strength of character where they came together and helped each other in a way that obviously makes the workforce very desirable," Press said.

The opening of a new auto plant can be a big boon to the local economy. The new Toyota Tundra plant in San Antonio, Texas, brought 2,000 jobs with the 2.2 million square-foot manufacturing plant. Twenty-one onsite suppliers brought an additional 2,000 jobs.

With an estimated total investment of nearly $1.6 billion, Toyota has been "a very positive influence," said San Antonio Mayor Phil Hardberger.

Beyond the impact of the Toyota facility itself, the plant brings national credibility when recruiting other companies, he said. San Antonio, long reliant on the military and tourism to support the economy, spent roughly 20 years trying to persuade Toyota to build in the south Texas city.

"When you get these big corporations coming in, you increase the possibility of getting another one," Hardberger said.