Honda has decided to produce its next-generation Civic hybrid in the U.S. state of Indiana, instead of Mexico, to avoid potential tariffs on one of its top-selling car models, according to three people familiar with the matter.

Reuters news agency reports that the Honda Civic, the second best-selling car in Honda’s lineup, may be manufactured in Indiana. While the tariffs are expected to go into effect Tuesday after a one-month pause, the plan to begin making Civics in Indiana, according to Reuters, puts the start date in May 2028.

To avoid import tariffs on vehicles made in Mexico, Honda Motor Co (NYSE:HMC) will reportedly manufacture the next generation of the Civic in Indiana, sources cited by Reuters said. Honda had initially planned to build the newest model Civic in Guanajuato,