Toyota Bets on Brazil While Mexico Keeps Production Crown
Toyota confirmed through official company statements that it will invest R$11 billion (about US$2.2 billion) in Brazil by 2030. The plan includes a new production site in Sorocaba, São Paulo, which will replace the Indaiatuba facility in 2026.
The new plant will add about 100,000 vehicles a year, with the option to scale higher depending on demand. This move increases Toyota’s installed capacity in Brazil and secures its long-term role in the region’s car market.
Toyota’s strategy relies on hybrid-flex technology, which combines electricity with ethanol. Executives explained that hybrid systems allow Brazil to leverage its biofuel network while reducing emissions without waiting for widespread charging stations.
The company also confirmed plans to bring its first fully electric cars to the Brazilian market in 2026. Brazil remains the largest vehicle market in Latin America, with 2.63 million new registrations in 2024, according to the national dealers’ federation Fenabrave.
Mexico, by contrast, sold around 1.50 million vehicles that year. However, Mexico still leads regional production. Data from Mexico’s national statistics agency INEGI shows the country built 3.99 million light vehicles in 2024, a record high.
Brazil produced 2.55 million vehicles the same year, according to the automakers’ association Anfavea. Both markets are growing in 2025. Brazil produced 7.8 percent more vehicles in the first half of 2025 compared to 2024.
Exports also climbed as Argentina’s demand recovered. Mexico reached a monthly production record in June 2025 with 361,047 vehicles and accumulated 2.01 million units in the first half of the year.
Toyota’s investment aligns with Brazil’s MOVER program, a government policy passed in 2024 and detailed by decree in April 2025. The program offers tax incentives for cleaner vehicles and sets rules for recycling and localization.
Toyota’s expansion strengthens local supply chains, since only the transmission and battery of hybrid models will remain imported. Brazil’s investment climate is also relevant.
Data from the Central Bank shows the country received US$33.8 billion in foreign direct investment in the first half of 2025, down 10.7 percent from the previous year. On a 12-month basis, flows reached US$67 billion, equal to 3.14 percent of GDP.
UNCTAD reported Brazil received US$62 billion in 2023 and US$59 billion in 2024, showing moderation but continued strength compared with other emerging markets.
Trade frictions between the United States and partners have created uncertainty, but evidence does not show a large withdrawal of foreign capital from Brazil. Instead, inflows appear to be slowing in line with the global decline of about 11 percent in 2024.
Toyota’s move illustrates Brazil’s dual position. The country is the region’s largest consumer market, while Mexico remains the main production hub tied to North American trade.
For Brazil, Toyota’s long-term bet confirms that global manufacturers still see value in serving its large domestic base and developing supply chains closer to consumers.
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This article was produced by The Rio Times’ automated newsroom system. How we use AI · Report an error · Editorial responsibility: Matthias Camenzind, Editor-in-Chief
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