Toyota will invest 265 million euros (228 million pounds) in Europe to build the next generation of its Auris compact hatchback in the UK and a compact saloon in Turkey, adding up to 1,900 new jobs in total.

This announcement ... is in line with our plan to increase local production for cars sold in Europe, Didier Leroy, President and CEO of Toyota Motor Europe, said in a statement on Thursday.

The Japanese carmaker, which is suffering under a strong yen, wants to both increase the total volume of compact cars produced in Europe while better utilising plant capacities through regrouping production.

The C-segment hatchback is a core vehicle for Toyota, competing in a strategic segment of the European automobile market, while sedans are stronger sellers in Eastern Europe, Leroy added.

Since the hatchback body style was popular largely in western Europe, production would be shifted from its plant in Sakarya, Turkey to the Burnaston plant in Derbyshire.

Toyota expects to recruit up to 1,500 additional workers in the UK, with a first recruitment phase of around 500 from the middle of 2012.

Turkey meanwhile would build the next compact sedan alongside the Toyota Verso, creating 400 jobs within the next two years.

(Reporting by Christiaan Hetzner)