Someone needs to explain to Trump how Toyota actually makes money

Darnell ReidJan 08, 2017

Japanese officials have defended Toyota's contribution to the United States economy after Donald Trump threatened to impose a "big border tax" on the carmaker if it went ahead with plans to open a new plant in Mexico.

That's because, in contrast to his earlier automaker targets, US -based Ford and General Motors, Toyota is a more complicated case: it's a Japanese company with a North American subsidiary headquarters (in Plano), and the production bound for Mexico would be moving not from the United States, but from Canada.

The piece shares stories of Mexicans upset with decisions by Ford and Carrier, which recently announced investments in USA -based plants in lieu of planned investments in Mexico.

Toyota now exports less than 10 percent of the vehicles it makes in Mexico to the United States. "Toyota division year-end results include record sales of both RAV4 and Highlander along with Camry continuing its sales leadership as the number one selling passenger auto in America for the 15th consecutive year".

President-elect Donald Trump threatened Toyota Motor Corp. on Thursday not to build a new plant in Mexico. Against the backdrop, Japanese, U.S. and European automakers have plants in Mexico, and suppliers and other related businesses also operate there.

Ford, however, still plans to shift production of small cars to Mexico from MI.

"Throughout his campaign and now, after his election, Trump has made it crystal clear that he would prefer that manufactured goods made for Americans be manufactured in the United States", Nerad said.


"Toyota looks forward to collaborating with the Trump Administration to serve in the best interests of consumers and the automotive industry", the Japanese automaker said. The Mexican peso declined nearly a percent in response.After Ford, Mr. Trump targeted General Motors' plant in Mexico, saying GM needed to be taxed for certain versions of the Chevrolet Cruze small auto that it imports from Mexico to US dealers.

"Toyota has made investments and created jobs in the United States".

Trump's tweet was followed by Toyota shares dropping more than 3% in morning trade in Tokyo on Friday.

The $1 billion plant, meant to expand production of Toyota's Corolla line, was announced in April 2015 and is expected to open in 2019.

Toyota has not directly addressed Mr Trump's tweet, but said in a statement that production and employment in the U.S. will not decrease due to the Mexican plant.

A General Motors spokesperson confirmed to Fox News that the company imported 8,400 Cruze sedans a year ago to supplement USA production during the launch of the latest model, something it announced at the time, but insisted that it hasn't brought any more in since the fall.

Additionally, Toyota already began construction of the facility back in November.

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