Toyota’s announcement to return production of theTacomato the United States follows a year of volatile shifts in trade agreements, tariffs, and confusion among automakers working to comply with the Trump Administration. President Trump bypassed the United States-Mexico-Canada Agreement (USMCA) with a 25% tariff on vehicles and parts assembled outside the US in March 2025, which received both support from the United Auto Workers (UAW) Union and pushback from major US automakers like Ford, General Motors, and Stellantis.
Of the automakers that assemble vehicles within the US, Toyota builds 12 nameplates across five manufacturing sites. It builds more individual models in the US than GM, starting the conversation about which brands are the “most American.” By the end of the decade, the Tacoma will be joining the list of American-built vehicles, a title it hasn’t held since 2021, when production was made exclusive to its two Mexican manufacturing facilities. Its move back to Texas means a few things for the automaker as it looks to scale up production of its popular mid-size pickup.
What’s in it for Toyota?
2025 Toyota Tundra i-FORCE MAX TRD Pro badge logoToyota
If a vehicle’s final assembly point is within the US, the imposed tariffs on that vehicle stem from the individual parts used to build it. The Trump Administration has pressured automakers to move production of popular nameplates to the US with tariffs, as well as pressing them to source parts for vehicles within the country. A 25% tariff was applied across the board on imported vehicles, as well as components sourced from outside the country. Toyota’s move to bring the Tacoma back to the US involves revamping its San Antonio assembly plant, where the full-size Tundra pickup and Sequoia SUV are built.
An extra 2.5 million square feet is being added to the facility to make room for the Tacoma, with Toyota also adding 2,000 new jobs. The total cost of this effort rings up at $3.6 billion. The automaker’s investment in US production was acknowledged by Texas Governor Greg Abbott, saying the investment qualifies for $20 million in state funding and other incentives, according to Reuters.
Toyota Factory San Antonio TexasToyota
The expanded facility will start production of the Tacoma in 2030, Toyota says. A brand-new 500,000-square-foot rear axle assembly shop is set to go online this fall, also in San Antonio, where axles for the Tundra, Sequoia, and Tacoma will be manufactured. The $531 million investment will create 411 new jobs, all in an effort to increase production and support the Tacoma’s homecoming. Toyota was awarded a temporary tax reduction by both Bexar County and the City of San Antonio worth a combined $30 million for expanding its operations.
Toyota has been present in San Antonio for 20 years, where it set up shop to build the Tundra and Tacoma. In late 2021, the Tacoma was removed from the line in San Antonio to make room for the Sequoia—which had previously been assembled at Toyota’s Princeton, Indiana plant. Tacoma production was split between two plants in Mexico, one in Baja and another in Guanajuato where it will remain, after the Sequoia was moved to Texas to make room for the Grand Highlander in Indiana.
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What the Tacoma’s US Homecoming Means for Consumers
2026 Toyota Tacoma TRD PreRunner front 3/4 angle in grayToyota
Despite the increased manufacturing costs Toyota will incur by having the Tacoma assembled in the US, it is receiving a slight reprieve through tax breaks from state and local governments in exchange for creating jobs and boosting the state’s economy. In 2024, the US was reported to be the 5th-most expensive country to manufacture cars, behind France, Italy, the UK, and Germany. Data published by Oliver Wyman, a management consulting firm based in New York City, revealed the labor cost per car around the globe, shedding light on how much a single vehicle’s manufacturing cost is rooted in labor expenses.
Labor Cost per Vehicle by Country ($ USD, 2024)
Morocco
106
Romania
273
Mexico
305
Turkey
414
China
597
Poland
663
Czech Republic
691
Japan
769
South Korea
789
Slovakia
830
Spain
955
Canada
968
United States
1,341
France
1,569
Italy
2,067
United Kingdom
2,333
Germany
3,307
Source: Oliver Wyman analysis, Automotive manufacturer websites, original data source GlobalData, German Association of the Automotive Industry (VDA), Liepin
The $1,341 per-car cost is a real, new expense for Toyota compared to assembling trucks in Mexico, where the reported cost is just $305. According to the US Bureau of Labor Statistics, the national average hourly earnings for autoworkers in June 2026 was $33.89. Labor costs in Mexico associated with automobile production in some states, as reported by Mexican commerce advisors Calder & Vale, were between $95 MXN and $119 MXN per hour, roughly equivalent to $5.40 USD and $6.80 USD, respectively.
Since all automakers are facing price hikes in the US due to a range of tariffs and economic sanctions, returning production to the US will likely limit any further price increases beyond the additional manufacturing costs. Costs saved by avoiding tariffs, as well as the additional tax breaks Toyota received, should dampen the financial impact on consumers, with overall costs lower than previously forecast.
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Increased Production Should Scare Detroit
2026 Ford Ranger Toyota Tacoma front viewToyota / Ford
The larger floor plan is expected to increase production of the ever-popular Tacoma, with Toyota selling 274,638 of them in the US in 2025. Chevrolet sold just 107,074 Colorado pickups, with Ford trailing behind at 70,960 Ranger pickups sold. Overall, Toyota was the biggest-selling automaker in the US last year, selling 2,147,098 cars, trouncing both Ford and Chevrolet by over a quarter-million vehicles.
The Ford F-Series line of pickups are still the most popular vehicles sold in America, with the Chevy Silverado and Toyota RAV4 close behind each year. The increased US production of America’s most popular mid-size pickup positions the Tacoma at the top of its segment, as Toyota will be avoiding fluctuating tariffs to cut costs where it can. Currently, the Tacoma is the only mid-size pickup to offer a hybrid powertrain, a decision that Toyota made to continue electrifying each of its offerings where it can—a practice the company has lauded as a more sustainable future for the industry rather than going all-in on EVs.
GM has stepped up its efforts to increase US production by bringing the Equinox SUV to its Kansas City, Missouri assembly plant from San Luis Potosí, Mexico where the Blazer and Blazer EV are built. The company has plans to bring the Chinese-built Buick Envision to Kansas City in 2028 as well. Ford was supposedly considering moving production of its extremely-popular Maverick pickup from Sonora, Mexico to either one of its facilities in Ohio or Tennessee.
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We Expect the Tacoma to Continue Selling By The Thousands
2025 Toyota Tacoma Limited front 3/4Toyota
A larger manufacturing site is certainly not going to hurt the Tacoma’s sales figures. Since the start of 2026, an estimated 143,848 Tacomas have been sold, more than halfway to surpassing 2025’s sales figures. Once the plant officially starts production in 2030, the 4th-generation Tacoma will have been on sale for 6 years, and if it follows the pattern of previous models, it will have anywhere between 3 and 4 years left before being replaced by the next generation.
The current-generation Tacoma is the only pickup truck on the market to offer a 6-speed manual transmission and a hybrid powertrain, and it is also the easiest to crest $70,000 among mid-size pickups, second only to the GMC Canyon, with two off-road trims: the Trailhunter and TRD Pro at $63,650 and $64,650 each. The GMC Canyon’s top-tier AT4X trim starts at $59,395 after destination, but the optional $10,100 AT4X AEV Edition package—adding underbody protection, beadlock wheels, meaty tires, and bed-mounted spare tire—brings the MSRP up past the base price of the off-road prepped Tacoma models.
After 2030, Toyota plans to build the trucks in both San Antonio and Guanajuato to supply North America, Costa Rica, Bolivia, Bermuda, and New Caledonia with new Tacomas. The rest of the world, however, gets Toyota’s most popular pickup, the Hilux. Interestingly, the US doesn’t get the Hilux because of the infamous “Chicken Tax,” which excluded it from being exported to the US. That worked out in our favor, however, since the Tacoma was built primarily to serve the American market, and now it’s coming back to do so again.
Sources: Toyota, Good Car Bad Car, Reuters, San Antonio Report, Oliver Wyman, Calder & Vale
