Trump Threatens Tax on Mexican-Made Corollas

President-elect Donald Trump continues to keep automakers on their toes with his unpredictable tweets. On Monday, Trump threatened GM with a “big border tax” if the company doesn’t move production of the Chevrolet Cruze hatchback to the U.S. Now, Trump is threatening the same for Toyota in regards to the Corolla.

“Toyota Motor said will build a new plant in Baja, Mexico, to build Corolla cars for U.S. NO WAY! Build plant in U.S. or pay big border tax,” Trump tweeted today.

The plant Trump is referring to is actually being built in Guanajuato, Mexico, not Baja. Toyota announced in 2015 that it was investing more than $1 billion into the plant that would begin building Corollas in 2019. The plant will receive tooling for Toyota’s TNGA platform, allowing for greater production flexibility. The automaker broke ground on the Guanajuato site in November 2016.

Toyota Motor said will build a new plant in Baja, Mexico, to build Corolla cars for U.S. NO WAY! Build plant in U.S. or pay big border tax.

— Donald J. Trump (@realDonaldTrump) January 5, 2017

“Toyota has been part of the cultural fabric in the U.S. for nearly 60 years,” the automaker said in a statement. “Production volume or employment in the U.S. will not decrease as a result of our new plant in Guanajuato, Mexico announced in April 2015. With more than $21.9 billion direct investment in the U.S., 10 manufacturing facilities, 1,500 dealerships and 136,000 employees, Toyota looks forward to collaborating with the Trump Administration to serve in the best interests of consumers and the automotive industry.”

In its statement, Toyota detailed many of the investments it has made in U.S. operations, including spending $360 million at its Georgetown, Ky., plant, $150 million at its Huntsville, Ala., plant, $100 million at its Princeton, Ind., plant, and $90 million at its Buffalo, W. Va., plant. Toyota says these investments added 1,130 U.S. jobs. Toyota’s plant in Baja, Mexico, has supported production of Tundra and Tacoma pickup trucks at its San Antonio, Tex., facility since 2002.

In an interview with Bloomberg published earlier today, Toyota president Akio Toyota said he would take the President-elect’s decisions into account when planning the company’s operations in Mexico. Trump has threatened tariffs as high as 35 percent on Mexican-made cars. Up until now, Ford and GM have taken the most heat from the President-elect’s Twitter account. Ford cancelled plans to build a new Focus plant in San Luis Potosi, Mexico, this week. However, Focus production isn’t coming back to the U.S. The Blue Oval will expand capacity at its existing plant in Hermosillo to accommodate the Focus. Ford CEO Mark Fields insists the decision was not politically motivated, instead driven by the slowdown in small car sales.

With Trump now going after Toyota, there’s no telling which automaker could be next. Honda, Mazda, Nissan, and Volkswagen have all recently opened plants in the region. Nissan and Daimler are working together on a plant in Aguascalientes, and BMW is building one in San Luis Potosi.