Toyota’s $3.6 Billion Texas Bet Reshapes the Tacoma Lineup

Toyota will spend $3.6 billion to shift most Tacoma pickup production from Mexico to a doubled San Antonio campus, adding 2,000 jobs to a Texas workforce that already builds the company’s Tundra and Sequoia. The plan lands five days after the United States opted not to extend the USMCA trade pact with Mexico and Canada, putting annual reviews in its place and leaving automakers to read the rules one year at a time. Toyota confirmed it will keep building some Tacomas in Mexico and urged a quick resolution to the trade review, holding both sides of the new US border.

What Toyota Just Announced in San Antonio

Toyota Motor North America said Monday it will invest $3.6 billion to expand its San Antonio manufacturing campus with a second vehicle assembly line dedicated to the Tacoma, per Toyota’s San Antonio plant expansion release. The expansion will create 2,000 new jobs and add 2.5 million square feet, roughly doubling the size of the South Side plant by 2030. With the addition, Tundra, Sequoia and Tacoma will all roll off Texas lines; a separate rear axle facility on the same campus is set to start production this fall. The campus sits on 2,000 acres of South Texas ranchland, selected when Toyota broke ground in 2003.

The investment lifts Toyota’s total spending at the San Antonio site to $8.3 billion since the plant broke ground in 2003. Local employment will climb to roughly 6,000 team members, supported by 23 on-site suppliers. Once the new line is fully ramped, annual capacity at the campus will rise from roughly 200,000 to 350,000 units, and the San Antonio facility assembled more than 197,000 vehicles last year alone.

Texas Governor Greg Abbott cast the deal as a state-level win: “Texas is where the world builds bigger, and Toyota shows it once more with a $3.6 billion expansion in San Antonio that doubles their factory footprint and creates 2,000 new jobs.” San Antonio Mayor Gina Ortiz Jones said the city had spent more than a month “wooing” Toyota to pick it over other competing sites the automaker did not publicly name. Bexar County Judge Peter Sakai called it “the plant’s second milestone investment in two years.” Construction is set to begin this year, with completion targeted for 2030.

The Tijuana-to-Texas Move, Year by Year

The Tacoma will move from Toyota Motor Manufacturing Baja California, the company’s Tijuana plant, to the expanded San Antonio campus over an approximate four-year period. Hiring for the new assembly line follows a steep ramp, per filings with the Texas Comptroller’s Office. The company first moved Tacoma production from San Antonio to Guanajuato in 2021, and this week’s announcement does not undo that step. Instead, it ends Tacoma output at a second Mexican plant, TMMBC in Tijuana, and brings the truck back to Texas for a second time.

Toyota’s hiring schedule for the San Antonio line is back-loaded into the final two years before completion. The ramp is staged to roughly track the build-out of the new facility. The Texas site already runs Tundra and Sequoia production on one line and is preparing to open a separate rear axle facility this fall. A local incentive package worth at least $303 million helped secure the expansion, with pay conditions requiring Toyota to pay workers at least $32.46 an hour, the Bexar County average wage. Project codenamed “Orca” before its public unveiling, the expansion was first reported by Automotive News in May.

Per filings with the Texas Comptroller’s Office, the hiring ramp looks like this:

• 320 workers hired in 2028
• 1,440 workers hired in 2029
• 240 workers hired in 2030

The USMCA Decision Behind the Announcement

Toyota’s announcement lands five days after the Trump administration confirmed it would not extend the USMCA trade agreement with Mexico and Canada, sending the three countries into an annual review instead. USMCA governs roughly $2 trillion in annual goods and services trade across the three countries, with the auto industry alone representing about 18% of that flow. Automakers and suppliers have warned that reopening the framework raises the prospect of new tariffs and changed rules of origin, the formulas that decide how much of a car must come from North America to qualify for duty-free treatment.

The current rule requires 75% regional value content for passenger vehicles and light trucks. The Trump administration has reportedly pushed to raise that threshold to 82%, with 50% of the value produced in the United States specifically. Both targets sit above where most US-sold vehicles currently qualify. Roughly a dozen vehicles meet today’s 75% floor; none reach 80%, according to the National Highway Traffic Safety Administration’s 2026 parts content list. Vehicle content is drawn from an average of 50 to 120 countries per car, by S&P Global Mobility’s count, making any wholesale reroute slow and expensive.

Toyota’s continued investment in North America is a testament to our confidence in the region’s workforce, innovation and long-term growth potential.

Ted Ogawa, president and CEO of Toyota Motor North America, made the comment in the company’s release announcing the San Antonio expansion on July 6.

Toyota is not waiting for the new rules to settle. The company’s release notes it “remains committed to its operations throughout the U.S., Canada, and Mexico, and encourages a quick resolution to USMCA.” Toyota currently builds Tacomas in both Mexico and the US, and will continue to do so after the Texas line opens.

Industry voices have described the review period itself as a risk. “If we let this go on for a very long time, it’s very painful for everyone,” said Diego Marroquín Bitar, a fellow at the Center for Strategic and International Studies. “That’s the last thing that the region needs,” Bitar added. Boston Consulting Group partner Aakash Arora put it more bluntly: “All chips are on the table.” What is clear across all scenarios being discussed, Arora said, is “higher content from the U.S.”

The investment also closes a competitive gap for Toyota at home. Through the first half of the year, Toyota’s US sales rose 0.5% to 1.24 million vehicles, narrowing the gap with General Motors. GM posted a 6.8% decline to 1.34 million vehicles over the same stretch, hurt by its heavier bet on all-electric vehicles as hybrid demand grew. Toyota is the world’s largest automaker by vehicle sales and employs 48,000 people in the United States.

What Mexico Keeps, and What It Loses

The split between what Mexico loses and what Mexico keeps is itself part of the story. Baja California loses Tacoma volume but stays open. Guanajuato keeps its Tacoma line, and the company’s broader footprint there grows.

Toyota’s statement that it “encourages a quick resolution to USMCA” frames the move as a hedge, not a withdrawal. The press release confirms that the new Texas line “aligns with Toyota’s broader North American operations.” The Baja California plant, which employs over 2,000 people in Tijuana, will run for the four years it takes to shift Tacoma volume and remains Toyota’s main cross-border operation, per Toyota’s profile of its Tijuana workforce. Toyota has not specified what TMMBC will build after Tacoma leaves, and a Toyota spokeswoman “declined to share additional details” when asked by CNBC. The Guanajuato plant, which has about 1,500 employees, retains Tacoma production after the shift.

The map of where each truck will be built after 2030 shows how Toyota has chosen to split its bets.

The Industry’s Read on Toyota’s Bet

Industry watchers read Toyota’s move as both a defensive hedge and a competitive play. The shift pulls Tacoma production closer to the largest US pickup market, where Toyota’s sales have grown through the first half of the year. The added capacity also helps Toyota push more hybrid trucks, where the company has led for decades. Cox Automotive forecasts Toyota will narrow the gap with GM this year as hybrids gain share.

GM, the largest US seller, posted a 6.8% decline through the first half to 1.34 million vehicles. Toyota’s US sales rose 0.5% over the same stretch to 1.24 million vehicles. GM has heavily invested in all-electric vehicles rather than hybrids, calling them a “transitional technology.” Toyota’s announcement also comes as the broader US auto industry faces the prospect of new tariffs and changed rules of origin. Automakers and suppliers have warned that the annual USMCA review, by itself, could pull back investment until the rules are settled.

How Toyota Reaches 2030

The road to 2030 runs through a series of milestones Toyota has laid out and several it has not. Construction on the new San Antonio assembly line is set to begin this year. Hiring begins in 2028 and ramps sharply through 2030.

State and local officials have tied their support to a package worth at least $303 million, a combination of property tax breaks, infrastructure funding, and grants. The deal requires Toyota to pay workers at least $32.46 an hour, the Bexar County average wage. Toyota must also use 10% of the savings from the city’s tax abatement for worker training, transportation, or child care. Bexar County has asked the Texas Attorney General to block records requests about the negotiations.

The USMCA review, by contrast, has no published timeline. The first round of talks has not been formally announced. Without a new agreement, the pact would expire by 2036.

For now, Toyota’s announcement lays down a marker that other automakers will watch closely, per a CNBC breakdown of the USMCA decision and what automakers fear. The first USMCA review round will determine whether the framework shifts toward higher US content thresholds and what that means for the roughly 50 to 120 countries that contribute parts to a single vehicle. If the new thresholds land near 82%, essentially no current US-sold vehicles would meet the regional content floor, per the 2026 NHTSA parts content list. The auto industry has warned that meeting those rules will require years and billions in additional US investment.

Frequently Asked Questions

When will Tacoma production move to San Antonio?

Toyota said the shift from its Tijuana plant, Toyota Motor Manufacturing Baja California, to the expanded San Antonio campus will take approximately four years. Construction on the new assembly line begins this year and is targeted for completion by 2030, with hiring ramping from 320 workers in 2028 to 1,440 in 2029 and 240 in 2030.

How many jobs will Toyota add in San Antonio?

The expansion will create 2,000 new jobs at the San Antonio campus, lifting Toyota’s local workforce to about 6,000 team members, supported by 23 on-site suppliers. As part of the local incentive agreement, Toyota must pay those workers at least $32.46 an hour, the Bexar County average wage.

Is Toyota leaving Mexico?

No. Toyota said it will keep building Tacomas at its Guanajuato, Mexico, plant even as it shifts that work’s volume from Tijuana to Texas. The company also said it remains committed to its operations throughout the U.S., Canada, and Mexico and urged a quick resolution to USMCA.

What changed with USMCA?

On July 1, 2026, the United States declined to extend USMCA automatically, sending the trade pact into an annual review process. The current framework requires 75% regional value content for passenger vehicles and light trucks; the Trump administration has pushed to raise that to 82%, with 50% produced in the US specifically.

How big is Toyota’s overall US investment?

The San Antonio announcement is part of Toyota’s stated plan to invest up to $10 billion in the United States through 2030. The San Antonio plant alone has now absorbed $8.3 billion in cumulative investment since breaking ground in 2003.