Toyota has decided to postpone its EV production in the United States to increase manufacturing capacity for its popular gas-powered and hybrid SUVs.
The upcoming electric SUV is now set to begin production in 2028 at Toyota’s Georgetown, Kentucky plant, marking a shift from the automaker’s earlier plan to start manufacturing in 2027 at its Princeton, Indiana facility. This change comes despite a $1.4 billion investment made in Princeton in April of last year.
The move will facilitate increased production of the Grand Highlander SUV, offered in petrol-only and hybrid petrol-electric variants, which remains one of the company’s top-selling models.
Toyota’s production shift also reflects waning demand for electric vehicles in the U.S. market and growing concerns over the Senate’s legislation to end federal tax credits for EV purchases. In May, the company confirmed its intention to launch seven electric vehicles in the U.S. by mid-2027, including two models that will be manufactured domestically.
Although EV sales grew across the U.S. in 2024, Toyota’s fully electric vehicle sales remained modest, totaling under 30,000 units. In contrast, hybrid petrol-electric models saw a sharp increase in demand. The Grand Highlander stood out as a top performer, with more than 11,500 units sold last month. Due to this strong demand, dealers had only enough inventory to last three days at the current sales pace.
Last month, Toyota indicated that it may begin offering American-made vehicles through its domestic dealership network in Japan.
The upcoming electric SUV will be assembled alongside another delayed three-row EV, as part of Toyota’s broader strategy to streamline and consolidate its production operations.
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