Toyota to Move Tacoma Production to Texas as Trump Admin Punts US/Canada/Mexico Trade Deal

Japanese automaker Toyota just announced it will spend $3.6 billion to bring production of its top-selling midsize pickup, the Tacoma, back to the U.S. by 2030.

“Toyota is moving from Mexico to the United States (Texas!). A really big deal. Tariffs at work! President DONALD J. TRUMP,” President Trump announced this morning on Truth Social.

This announcement also comes a week after the Trump administration announced they formally declined to renew the United States-Mexico-Canada Agreement (USMCA).

Trump U.S. trade representative Ambassador Jamieson Greer said the US would not agree to renew the trilateral agreement, also known as USMCA, “in its current form,” according to Yahoo Finance.

This move creates some uncertainty for businesses – especially autos and integrated supply chains – but the agreement is still active and duty-free trade continues for now, CNBC reported. It’s a leverage tactic consistent with Trump’s approach – using the review process to push for better terms rather than accepting the status quo.

U.S. Trade Representative Jamieson Greer said in a statement released while the call was ongoing, the Trump administration “will continue to engage with Mexico and Canada to address the Agreement’s shortcomings.”

This makes the Toyota decision more apparent.

Toyota, the world’s top-selling automaker is aiming to make more vehicles in the U.S. to help defray the hefty tariff bill with the midsize pickup, its largest market. The company also needs more domestic capacity as it struggles to keep its U.S. dealers stocked with vehicles, the WSJ reports.

The company already assembles its larger Tundra full-size pickup truck and Sequoia SUV in San Antonio, producing just shy of 200,000 vehicles annually. The plant currently employs about 3,700 people. The Tacoma line will add about 150,000 trucks to the plant’s annual output.

“Trump has long complained about the U.S. sustaining trade deficits with its economic partners. Seeking to address that perceived unfairness and force other policy changes, Trump in his second term imposed a series of tariffs on nearly every country, including Mexico and Canada.”

Could this be the beginning of the end of NAFTA?