2026 Toyota RAV4 is going hybrid-only, with expanded U.S. production planned for Kentucky

Tariffs are rising, price-protected inventory is thinning, and Toyota just dropped a fully retooled RAV4 built to (hopefully) handle both.

Driving the news: On Tuesday, Toyota unveiled the all-new 2026 RAV4—its most important U.S. model and top seller overall.

• Last year alone, the automaker moved nearly half a million RAV4s in the U.S., making it the best-selling vehicle in the entire market—not just in its segment.

• And that was with the outgoing model.

Now, as the sixth-generation RAV4 rolls out, it’s doing so under the weight of new 25% tariffs on imported vehicles.

But first, let’s set the stage: To delay pricing pressure, many automakers are leaning on older, tariff-free inventory. 

However, Toyota doesn’t have that cushion, because dealers are clearing cars almost as fast as they arrive, ending each month with just a 10-day supply, according to Toyota North America COO Mark Templin on CNBC.

• To keep up, Toyota is planning to build 200,000 more vehicles this year than in 2024—a target that still might not satisfy demand on the ground. 

• And if we’re talking timeline, he expects those dominos to fall by late June.

So what’s Toyota’s counterpunch? 

A volume driver that’s electrified, localized, and strategically timed.

Let’s talk next-gen RAV4…

First: The 2026 model drops gas-only trims entirely. 

• Every version is now hybrid or plug-in hybrid and comes in three new styles: Core, Rugged, and Sport. 

• Returning favorites like the off-road Woodland get more gear, while the new GR SPORT brings track-inspired tuning from Toyota’s Gazoo Racing division.

Meanwhile, the PHEV models push 320 horsepower with up to 50 miles of electric range—and offer DC fast charging. 

• AWD hybrids hit 236 hp, and FWD hybrid options are now available. Towing capacity climbs to 3,500 lbs on select trims.

Inside: It’s a full tech refresh, with the new RAV4 running on Toyota’s Arene software platform, with an updated touchscreen system and Safety Sense 4.0 standard across the lineup. 

• A 12.3-inch digital gauge cluster is now standard, while higher trims add a Head-Up Display and shift-by-wire toggle controls.

And where it’s built matters too. 

Between the lines: The RAV4 has led the compact SUV segment for eight straight years—and was the best-selling model in America in 2024. 

• And the timing’s not a coincidence. This redesign is Toyota’s way of staying ahead as costs climb, policies shift, and demand keeps moving.

What’s next: The 2026 RAV4 hits showrooms later this year. Pricing is still TBD—but if tariffs stick, don’t expect it to stay flat. That said, if Toyota nails the balance of performance, efficiency, and availability, the RAV4 could keep its crown, and then some.

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