Toyota Motor North America officials said Monday that the company is investing $3.6 billion to bring production of its midsize Tacoma pickup truck to San Antonio from Mexico — a shift that would create 2,000 new jobs at its existing plant on the South Side.
That move comes at a cost, though.
In exchange for adding a second vehicle assembly line, roughly doubling the size of its San Antonio plant, the Japanese automotive company will receive $303 million in tax incentives, which include city, county, and state tax abatements, grants and refunds. It’s also receiving infrastructure support from CPS Energy and San Antonio Water System (SAWS).
Moving production from Toyota’s Tijuana plant to San Antonio is expected to directly create 2,000 jobs at an hourly rate of $32.46. However, the 10-year tax abatement package means those jobs could cost the city, county and state more than $150,000 in lost revenue per job created, according to the San Antonio Report.
Those incentives come as both the City of San Antonio and Bexar County navigate looming $100 million-plus budget deficits. At the same time, SAWS is still seeking a rate hike from customers to fund needed infrastructure improvements. CPS Energy is also weighing whether to ask City Council for a rate adjustment in the fall.
Despite the hefty size of the abatements, public officials are likely eyeing long-term tax benefits from Toyota’s multibillion dollar investment along with spinoff employment created by the expansion.
“Toyota’s continued investment in North America is a testament to our confidence in the region’s workforce, innovation and long-term growth potential,” Toyota Motor North America CEO Ted Ogawa said in the release. “By expanding our San Antonio plant, we are deepening our commitment to American manufacturing, creating meaningful and sustainable jobs, while advancing our mission to deliver high-quality vehicles that meet the changing needs of customers today and into the future.”
In addition to the Tacoma, which was produced in San Antonio from 2010 until 2021, the local plant will continue to produce Toyota’s Sequoia SUV and Tundra pickup truck.
The move by the world’s largest automaker comes a week after President Donald Trump declined to renew the trilateral United States-Mexico-Canada (USMCA) agreement, which made it easier for companies to build and trade across borders between the three countries.
“Toyota remains committed to its operations throughout the U.S., Canada and Mexico, and encourages a quick resolution to USMCA to make the North American region globally competitive,” company officials said in a statement as part of its Monday announcement.
Sign Up for SA Current newsletters.
Follow us: Apple News | Google News | NewsBreak | Reddit | Instagram | Facebook | Twitter | Or sign up for our RSS Feed
