Toyota invests $3.6 billion in local Tacoma production in Texas

Toyota announced that it will build a new $3.6 billion facility on its San Antonio, Texas, campus and shift production of the Tacoma pickup there from its existing facility in Baja California, Mexico. The new 2.5 million-square-foot facility will open in 2030, creating about 2,000 local jobs and forming part of a broader effort by the Japanese automaker to shield itself from U.S. tariffs on Mexican-made vehicles. The expansion will double the size of the San Antonio campus to roughly five million square feet and bring Toyota’s total investment there (not adjusted for inflation) to $8.3 billion since construction began 23 years ago. A separate 500,000-square-foot rear axle factory is planned to open on campus this fall. San Antonio is currently operating near its full capacity of approximately 200,000 vehicles per year; The new line will add another 150,000 units, ramping up over four years from 2030. A separate Toyota plant in Mexico, located in Guanajuato, will continue to produce Tacomas for export to the United States, and the automaker has emphasized that it will maintain the broad scope of its commitments to operations in all three North American countries. It has not yet been determined what will replace the lost production at the Baja plant, which produced 166,653 Tacomas last year; a company spokesman said Toyota had nothing further to share. At the time of this writing, vehicles shipped north from Mexico were facing U.S. tariffs of up to 25%; It was a cost that weighed on Toyota’s margins and upended decades of industry-wide cross-border production planning. In a statement, Toyota Motor North America President Ted Ogawa framed the expansion in decidedly soothing terms, stating that it merely reflects the company’s “deepening commitment to American manufacturing.” It could be argued that Tacoma is too commercially important to be subjected to the ongoing volatility of US trade. Toyota achieved record sales of 274,638 units in the USA in 2025, an increase of 42% compared to 2024. Sales are up almost 10% through June 2026 as the company moves closer to potentially surpassing General Motors in new car sales volume in the US. The deterioration of USCMA talks made the timing of the announcement even more difficult. Indeed, the agreement came just five days after the United States set a July 1 deadline to renew its North American trade deal transition without extension, opting instead for periodic annual reviews rather than a long-term agreement. Toyota had called on Washington to expand the agreement, saying it was critical for integrated automobile production. Continued U.S. pressure to tighten regional content and domestic value rules for vehicle parts is providing further incentives for automakers to move production entirely out of Mexico. Bloomberg Intelligence Senior Analyst Tatsuo Yoshida said “this shift appears strategically sound if current U.S. trade policies and tariff levels remain the same,” but he also highlighted the more difficult question of what will happen to the Baja facility’s spare capacity. “Any filler product will likely need to target markets outside the U.S. and offer sufficient scale to maintain the facility’s profitability.” The expansion in San Antonio further expands Toyota’s commitment to invest $10 billion in U.S. manufacturing over the next decade, following separate commitments of $1 billion to plants in Indiana and Kentucky and $912 million in five other states. Texas Governor Greg Abbott said the investment qualifying for the $20 million state grant “reflects the strength of our workforce and the unique business advantages found only in our state.”

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