Toyota to invest $3.6 billion to move Tacoma production to Texas

Tariff pressures spurred $3.6B U.S. expansion

Toyota will add the second assembly line at its existing San Antonio campus, where it currently builds the full-size Tundra pickup and Sequoia SUV. The plant now produces just shy of 200,000 vehicles annually and employs about 3,700 people. The Tacoma line will add roughly 150,000 trucks to that output.

The company builds the Tacoma in roughly equal numbers at plants in Guanajuato and Baja California, Mexico. Production from the Baja facility will shift to San Antonio when the expansion is complete in 2030, Toyota said. The Guanajuato plant’s output will continue unaffected. Toyota declined to comment on its plans for the Baja plant after the Tacoma’s exit.

Bringing production to the U.S. will help Toyota reduce a significant tariff bill in its largest market, the company said. Toyota’s North American division swung to a loss in the fiscal year ended March after taking a 1.38 trillion yen, or about $8.5 billion, hit to operating income from U.S. tariffs. John Murphy, founder of advisory firm Murphy Automotive Partners, called the figure “bonkers.”

Japanese autos are subject to a 15% tariff following a trade deal President Trump struck about a year ago, the Wall Street Journal reported. The Tacoma also faces tariffs on its non-U.S. content because of its assembly in Mexico. Toyota also imports vehicles to the U.S. from Canada.

The company uses more than 90% of its North American factory capacity, the highest utilization rate in the industry, according to consulting firm AutoForecast Solutions, a sign that it needs to expand its facilities to make more cars. Toyota has struggled to keep its U.S. dealers stocked with vehicles, Murphy said.

Despite its extensive U.S. manufacturing presence — the Camry, Corolla, and RAV4 are assembled in America, among other models — tariffs on parts, components, and vehicles imported from Japan have sent Toyota’s profits sliding. MSI previously reported that Toyota’s fiscal-year profit fell 19% to 3.85 trillion yen ($25 billion) as tariffs reduced operating income.

The San Antonio campus previously assembled the Tacoma from 2010 to 2021, when the truck was fully moved to Mexico. The Tacoma, launched in the mid-1990s, has long been the dominant seller in the midsize pickup segment, with sales consistently exceeding those of the Ford Ranger and Chevrolet Colorado.

Toyota’s U.S. sales grew 0.5% in the first half of 2026, bucking an industrywide decline of 2.5%, according to Motor Intelligence. Toyota is the second-largest automaker in the U.S. by sales, behind General Motors.

Several automakers have announced plans to expand their U.S. manufacturing bases following tariff increases, particularly for lucrative gas trucks and SUVs. Construction of the new San Antonio assembly line will begin this year and is expected to be completed in 2029, with operations starting in 2030, according to a regulatory filing reported by Autoblog.