Picking up sometime after the Trans-France Race, protagonist Pete Stancheck has inherited Herbie from his uncle Jim Douglas and travels to Puerto Vallarta, Mexico with his friend Davy "D.J." Johns to retrieve the car. They get directions from Paco, a comically mischievous, orphaned pickpocket to the car lot. Unable to pay the holding fee due to Paco taking their wallets, the pair quickly leave in Herbie to find him, and discover some of Herbie's abilities. Elsewhere, Paco pickpockets one of the members of a trio of three villains who are planning to steal the gold from some forgotten Inca ruins. The trio chase Paco after realizing the film showing the location of the gold is in the stolen wallet, but Pete and DJ catch him first. They decide to let Paco go only to realize their wallets have been taken by Paco again. Paco hides in Herbie's luggage compartment, and is consequently loaded on the Sun Princess cruise ship, bound for Rio de Janeiro, where Pete and DJ plan to enter Herbie in the Brazil Grand Prêmio. En route, they meet an anthropology student named Melissa and her extravagant, eccentric aunt Louise, who is trying to find a husband for her niece. When Herbie wreaks havoc on board, Pete pretends to court Melissa, intending that her Aunt Louise will sponsor their race.
