Donald Trump has tweeted that Toyota will face hefty tariffs on cars built in Mexico for the US market.
The President-elect said the Japanese company would be hit with a «big border tax» if it went ahead with plans to build Corollas south of the border.
American car companies have faced harsh criticism from Mr Trump for building cars more cheaply outside the US.
Toyota’s President Akio Toyoda said the company had no immediate plans to curb production in Mexico.
«We will consider our option as we see what policies the incoming president adopts,» said Mr Toyoda, speaking in Japan on Thursday.
The company’s US arm issued a statement which said that production and employment levels at Toyota in the US would not decrease as a result of the new plant in Mexico. The company has ten manufacturing plants in the US.
«Toyota looks forward to collaborating with the Trump Administration to serve in the best interests of consumers and the automotive industry,» the statement said.
Mr Trump has already targeted American carmakers General Motors and Ford for manufacturing south of the border, resulting in Ford’s decision to cancel its plans for a $1.6bn (£1.3bn) plant in Mexico and expand operations in the US instead.
The Nafta free trade area, and the lower cost of labour, makes it attractive for firms to build cars in Mexico for sale in the US.
But Mr Trump has said he would end this practice, as it was costing American jobs.
Toyota announced in April 2015 it would build a $1bn Corolla factory in central Mexico. Construction began in November 2016.
It has existing manufacturing facilities in Baja, Mexico which were established in 2002.
