The Japanese carmaker arrived at the New York International Auto Show following one of its best-ever years in the U.S. market in 2025, with a solid start to 2026 that has seen it outperform major rivals like Ford and General Motors, News.Az reports, citing Yahoo Finance.
Amid higher vehicle prices and rising fuel costs, Toyota is aiming to sustain its leadership by accelerating its electric vehicle strategy. The company plans to expand its battery electric vehicle (BEV) lineup from one model currently on sale to four by the end of this year, according to David Christ, group vice president and general manager of Toyota Motor North America.
The rollout will include a mix of models targeting different segments. The compact C-HR EV is beginning to arrive at dealerships, followed by the bZ Woodland, designed as a larger and more rugged option for outdoor-oriented buyers. Later in the year, Toyota plans to introduce a fully electric Highlander, a seven-passenger SUV that will be produced in the United States.
This push toward domestic production is part of a broader strategy to manage costs and mitigate tariff exposure. Toyota has committed significant investment to U.S. manufacturing, including a $13.9 billion battery plant in North Carolina, an additional $10 billion in recently announced U.S. investments, and $1 billion allocated to expand facilities in Kentucky and Indiana.
The company currently produces about 85% of the vehicles it sells in North America within the region, with 55% built in the U.S. This localized production has helped Toyota better navigate tariffs compared to some competitors. However, certain models, such as the GR Corolla and the new Tacoma, are still imported and subject to additional costs.
Tariffs remain a significant challenge. Toyota estimates tariff-related expenses will reach $9 billion for the fiscal year ending in March, the highest among major automakers operating in the U.S. Vehicles like the Tacoma, built in Mexico, are particularly affected by a 25% import tariff, although partial rebates are available for U.S.-made components.
Despite these pressures, Toyota says it remains focused on affordability, maintaining a lineup that includes six models priced under $35,000. Company executives also highlighted broader cost concerns for consumers, including interest rates, insurance, and fuel prices, which influence purchasing decisions.
On the supply chain side, Toyota has so far avoided major disruptions from the closure of the Strait of Hormuz, though it continues to monitor the situation closely. The company noted that its vehicle sales in the Middle East have been significantly affected.
At the auto show, Toyota also showcased the redesigned RAV4, featuring a new powertrain, updated platform, and enhanced safety systems. The model remains a key driver of the company’s success, holding its position as the top-selling vehicle in the U.S.
