Toyota will spend an additional $1.3 billion to prepare its Kentucky factory for production of a new three-row all-electric SUV designed for U.S. consumers, the company announced Tuesday. The extra capital pushes Toyota's total investment into the factory to nearly $10 billion and is the latest example of the automaker's renewed pledge to electrification.
Toyota has been criticized in recent years for lagging behind the industry's shift toward battery-electric vehicles. Toyota execs have largely stood by their decision to offer consumers a mixed portfolio of gas, hybrid, plug-in hybrid and battery electric vehicles. But last year, the company pledged to beef up its EV portfolio with a plan to introduce 10 new battery-powered vehicles by 2026.
The $1.3 billion investment will support assembly of the all-electric SUV and will be used to add a battery pack assembly line. The three-row all-electric SUV is expected to go into production in 2025. When it comes to market it will compete with Kia's new three-row EV9, which came to market in late 2023. Mercedes, Rivian, Tesla and Volvo also make three-row all-electric SUVs, although all of these are in the premium and luxury vehicle categories and have the price tags to reflect that.
The battery cells will be manufactured at Toyota's factory in North Carolina, another facility that has received additional investment from the automaker. Last year, Toyota announced plans to spend an additional $2.1 billion on the new battery plant.
Kerry Creech, president of Toyota Kentucky, said the announcement reflects the company's commitment to vehicle electrification and further reinvesting in its U.S. operations.
In the past three years, the company has announced new investments totaling $17 billion into its U.S. manufacturing operations to support electrification efforts.