New provincial and federal funding for Toyota’s Canadian manufacturing arm will facilitate the assembly of the first hybrid cars built in the country.

Toyota’s Cambridge, Ont., facility will receive $34 million in seed money needed to build a new assembly line. A total of $16.9 million came from the federal Automotive Innovation Fund, with the Ontario government matching the investment.

Speaking in Cambridge on Wednesday, Prime Minister Stephen Harper said the new assembly line will build first hybrid vehicle assembled in Canada.

“The RX 450 hybrid has been, up until now, only built in Japan,” Harper said. “But that’s changing.”

For its part, Toyota will put $125 million toward the new assembly line to increase production of Lexus luxury cars, including the hybrid model.

The initiative is expected to create 400 jobs at the facility.

Outgoing Ontario Premier Dalton McGuinty was also on hand for the announcement.