Toyota Shifts Tacoma Production Back to the United States Amid Tariffs

Toyota announced that, beginning in 2030, half of its midsize Tacoma pickup will be assembled at an expanded plant in San Antonio, Texas, where it already builds the Tundra and Sequoia. The remaining Tacomas will continue to be built at two facilities in Baja and Guanajuato, Mexico. The expansion adds 2.5 million sq ft, creates 411 new jobs, and is financed by a $3.6 billion investment that includes $30 million in state and local tax incentives.

Toyota Spending $3.6B to Return Tacoma Production to Texas

In March 2025 the Trump administration imposed a 25 % tariff on vehicles and parts assembled outside the United States, bypassing the United-Mexico-Canada Agreement (USMCA). The tariff was intended to spur domestic production, but most automakers have preferred to absorb the cost rather than build new U.S. facilities. General Motors, Ford and Stellantis have announced limited shifts of specific models to existing U.S. plants, but large-scale relocations remain rare. The USMCA is currently under renegotiation, adding further uncertainty for manufacturers that rely on cross-border parts flows.

CNN

• Total investment for the San Antonio expansion: $3.6 billion.

Toyota Spending $3.6B to Return Tacoma Production to Texas

• Additional plant construction: $531 million, creating 411 new jobs.

Toyota Spending $3.6B to Return Tacoma Production to Texas

• State and local tax breaks: $30 million (Bexar County and City of San Antonio).

Toyota Spending $3.6B to Return Tacoma Production to Texas

• Labor cost per vehicle (2024): United States $1,341, Mexico $305 (Oliver Wyman).

Toyota Spending $3.6B to Return Tacoma Production to Texas

• Toyota’s 2025 tariff bill: $8.4 billion, shifting its North American results from profit to loss.

CNN

• GM’s 2025 tariff bill: $3.1 billion; Ford’s: $1 billion.

CNN

• Tacoma sales: 274,638 units in 2025; 143,848 units sold YTD 2026, on track to exceed 2025 totals.

Toyota Spending $3.6B to Return Tacoma Production to Texas

President Donald Trump called the move “a really big deal” and cited it as evidence that “tariffs are work[ing].” Toyota’s spokesperson said the company “is impacted by evolving trade policies, but our investments are multi-decade decisions based on broader strategic goals.” The American Automakers Policy Council—representing GM, Ford and Stellantis—issued a statement urging “a swift and durable resolution that ensures a level playing field and provides long-term certainty needed for capital-intensive automotive investments.” Texas Governor Greg Abbott noted that the project qualifies for $20 million in state funding and other incentives.

CNN

Industry analysts warn that high U.S. labor costs and the volatility of tariff policy make large-scale production shifts risky. Ivan Drury, director of insights at Edmunds, described building a new factory “as a huge commitment … and to do it on a whim would be borderline crazy,” emphasizing that “the safest action is no action.” The American Automakers Policy Council’s appeal for certainty reflects broader concerns that current tariffs could erode competitiveness without delivering sustained domestic capacity.

CNN

• “It’s a huge commitment (to build a factory) and to do it on a whim would be borderline crazy,” — Ivan Drury, director of insights, Edmunds

CNN

• “While we are impacted by evolving trade policies, our investments are multi-decade decisions based on broader strategic goals,” — Toyota spokesperson

CNN

• “We urge a swift and durable resolution that ensures a level playing field and provides long-term certainty needed for capital-intensive automotive investments,” — American Automakers Policy Council

CNN

• “Toyota has been very successful at growing its truck business in the United States, and their San Antonio production is already the mainstay of that in the United States,” — Patrick Anderson, Michigan economist

CNN

The expanded San Antonio plant is slated to begin Tacoma assembly in 2030, after which Toyota will supply North America, Costa Rica, Bolivia, Bermuda and New Caledonia from both Texas and its Guanajuato facility. By avoiding future tariff fluctuations, Toyota expects to mitigate price pressures on the Tacoma, though higher U.S. labor costs will remain a factor in overall vehicle pricing.

Toyota Spending $3.6B to Return Tacoma Production to Texas