Toyota Motor Corporation is set to establish a new vehicle manufacturing facility in Toyota City, Aichi Prefecture, Japan, with operations anticipated to commence in the early 2030s. This marks Toyota's first new domestic assembly plant since 2012 and is envisioned as a forward-thinking facility integrating advanced technologies and promoting a diverse workforce. This strategic expansion underscores Toyota's commitment to its Japanese production capacity of 3 million vehicles annually, with a significant portion designated for export.
The announcement coincides with Toyota's first-quarter financial results for fiscal year 2026, which revealed a global vehicle delivery of 2.829 million units, a 7.3% increase year-over-year. However, the company has revised its full-year operating profit forecast downward by 16%, projecting 3.2 trillion yen (approximately $21.7 billion). This adjustment is largely attributed to an estimated 1.4 trillion yen ($9.5 billion) impact from U.S. tariffs on imported vehicles and components. Additional contributing factors include rising material costs and the appreciation of the Japanese yen. The imposition of U.S. tariffs, particularly the 25% levy on Japanese auto imports, has presented a significant challenge for the automotive sector. While a recent trade agreement between the U.S. and Japan has reduced tariffs to 15%, the full impact and effective date are still being clarified, creating ongoing uncertainty. This has led to a noticeable impact on Japanese automakers, with Honda, for instance, reporting a 50% drop in profits in a recent quarter, partly due to a 124 billion yen hit from these tariffs. The broader automotive industry in Japan, which accounts for a substantial portion of the nation's exports to the U.S., is particularly sensitive to these trade policies. Despite these financial headwinds, Toyota's investment in a new domestic plant signals a long-term vision focused on innovation and sustained manufacturing presence. The company's commitment to maintaining its robust domestic production capacity, even amidst global economic shifts and trade policy adjustments, highlights a strategic approach to balancing market demands and operational resilience. This forward-looking development in Toyota City aims to be a 'plant of the future,' reflecting a dedication to technological advancement and workforce development as the company navigates the evolving automotive landscape.