Toyota investing $3.6 billion in Texas plant, moving most Tacoma pickup production from Mexico

Toyota announced on Monday that it will be moving the majority of its mid-size Tacoma pick-up truck production from Mexico to the United States. This decision is part of a substantial $3.6 billion investment in its San Antonio, Texas plant. The transition from Toyota’s Tijuana, Mexico facility is expected to take about four years.

This move comes shortly after Washington opted not to renew a North American trade pact with Mexico and Canada, causing uncertainty for businesses. In November, Toyota had revealed its plans to invest up to $10 billion in the United States over the next five years.

The world’s largest automaker by vehicle sales, Toyota is set to construct a second assembly line at its San Antonio factory. This expansion will lead to the creation of over 2,000 jobs and a 150,000-unit increase in annual production capacity at the plant. The company stated that the investment aims to further enhance Toyota’s locally rooted and competitive production system.

While the majority of Tacoma trucks will now be produced in San Antonio, Toyota will continue to manufacture some at its Guanajuato, Mexico plant. Additionally, the company currently produces Tundra SUVs and Sequoia pickups at its San Antonio facility and is preparing to open a rear axle assembly facility on its Texas campus later this year.

In response to President Trump’s tariffs on automobiles, steel, and aluminum, Toyota and other major automakers are shifting production to the United States. Many global automakers, including those from the US, have been manufacturing vehicles in Mexico and other countries to benefit from various trade agreements, such as the US-Mexico-Canada Agreement (USMCA).

Despite the USMCA being in effect for another decade, Washington recently announced that the trade agreement will now be reviewed annually. This decision is expected to impact investor sentiment. Toyota remains committed to its operations in the US, Canada, and Mexico, and is hopeful for a swift resolution to the USMCA to ensure the North American region remains globally competitive.