Toyota is considering moving production of the next-generation RAV4 to the United States, according to a report by Reuters. The shift would be in response to U.S. tariffs imposed during President Donald Trump’s administration. Previously, Toyota planned to export the vehicle to the U.S. from Canada and Japan.
Currently, the RAV4 is manufactured in Kentucky, Canada, and Japan. Last year, over 475,000 RAV4 units were sold in the U.S., making it the country’s best-selling vehicle. This sales figure accounted for nearly 20% of Toyota’s total U.S. sales, surpassing even the Ford F-150, which had held the top spot for years.
If Toyota proceeds with the Kentucky plan, production of the next-gen RAV4 could begin in 2027, following the vehicle’s unveiling later this year. Manufacturing in the U.S. would help mitigate the impact of a 25% tariff on imported cars, as well as guard against potential cost increases due to fluctuations in the Japanese yen.
However, sources emphasized that Toyota’s production plans are still not finalized. Any changes to production require careful long-term planning, as retooling factories and adjusting supply chains are costly and time-consuming processes.
Toyota has invested nearly $50 billion in the U.S. over the years. The company operates 11 plants across the country, including parts manufacturing facilities, and produced nearly 1.3 million vehicles in the U.S. last year, which represents more than half of its U.S. sales.
The tariffs imposed by the Trump administration have had a significant impact on the global automotive industry. In response, several companies, including Volvo, Ford, and Nissan, have made changes to their production strategies. Other automakers, such as Mitsubishi and Stellantis, have suspended operations in certain regions or halted shipments to the U.S.
Meanwhile, the upcoming sixth-generation Toyota RAV4, which was leaked earlier this year on Weibo, is expected to feature a bold “Hammerhead” face, a body-colored honeycomb grille, and sharper styling. There may also be plug-in hybrid (PHEV) and fully electric (EV) versions of the vehicle.
