Toyota Approved for $1.3 Billion Argentina EV Production Plan
The investment, the largest in Argentina's auto industry, targets the Hilux BEV as Chinese competitors dominate regional sales.
Toyota has received approval to invest approximately $1.3 billion in its Buenos Aires plant to produce a new electric vehicle, marking the largest automotive investment in Argentina’s history.
What Happened
Toyota Argentina announced that its proposal to join the RIGI (Incentive Regime for Large Investments) was approved by the Evaluation Committee. The project involves upgrading the facility in Zárate, where Toyota has manufactured vehicles since 1997, including the Hilux pickup, SW4 SUV, and Hiace commercial van. According to Toyota, the initiative will create roughly 3,600 jobs during the initial construction phase and approximately 2,600 permanent positions once the upgrades are complete. While specific production details remain pending, Automotive News reports that the all-electric Hilux BEV is a likely candidate for assembly at the site. Currently, Toyota builds the Hilux EV in Thailand for export to markets in Europe, Asia, and Australia.
Why It Matters
This investment represents a strategic shift for Toyota as it faces intensifying competition in Latin America from Chinese manufacturers such as BYD, Geely, and Chery. Data from MarkLines indicates that BYD sold 85,800 vehicles in Latin America through July, accounting for nearly 60% of the region’s 147,493 electric vehicle sales during that period. By localizing production, Toyota aims to compete with the lower-cost offerings from these Chinese brands. Argentina’s Minister of Economy, Luis Caputo, stated that the plant is expected to generate around $1.28 billion in annual exports, with about 70% of production dedicated to foreign markets. This move aligns with Toyota’s broader global trend of adapting to Chinese supply chain advantages, including the use of Chinese batteries and software, to maintain market share in key regions.
The Bottom Line
Toyota’s $1.3 billion commitment in Argentina signals an accelerated pivot toward battery-electric production in South America. With global EV sales more than doubling through August compared to the same period in 2025, the automaker is leveraging local manufacturing and incentive regimes to counter the dominance of Chinese EV brands in emerging markets.
