A Potential Blow to Automakers and Suppliers, Threatening Popular Models and Jobs

A Potential Blow to Automakers and Suppliers

The United States is set to impose tariffs on Canada and Mexico, a move that could significantly impact the automotive industry. The tariffs, which could reach 25%, would affect several automakers and auto suppliers with plants in these countries.

Many automakers export hundreds of thousands of vehicles to the US every year. Popular models like Ram pick-ups, the Chevy Silverado, and Santa Fe SUVs could be hit by the tariffs. Additionally, auto parts like seat belts and air bags could also be affected.

Volkswagen: The Audi plant in San Jose Chiapa, Mexico, employs over 5,000 people and exports nearly 40,000 vehicles to the US annually.

The plant in San Luis Potosi, Mexico, produces the 3 Series, 2 Series Coupe, and M2, with most vehicles going to the US and other markets.

Ford has three plants in Mexico and exported nearly 196,000 cars to North America in the first half of 2024, with 90% going to the US.

GM imported roughly 750,000 vehicles from Canada or Mexico to the US in 2024, with most made in Mexico. These include the Chevy Silverado, GMC Sierra, and mid-sized SUVs.

Honda sends 80% of its Mexican output to the US market and has warned it may shift production if tariffs are imposed.

Kia has a factory in Mexico that makes its own vehicles and some Santa Fe SUVs for Hyundai, which are exported to the US.

Mazda exported around 120,000 vehicles from Mexico to the US in 2023 but may reconsider further investments if tariffs are imposed.

Nissan has two plants in Mexico where it makes the Sentra, Versa, and Kicks models for the US market.

Stellantis operates assembly plants in Mexico making Ram pick-ups and vans, as well as the Jeep Compass.

Toyota builds its Tacoma pick-up truck at two plants in Mexico and sold over 230,000 in the US in 2023.

Volkswagen's factory in Puebla, Mexico, made nearly 350,000 cars in 2023, all for export to the US.

In addition to automakers, several auto parts suppliers with plants in Mexico and Canada could also be affected. These include Autoliv, Michelin, Yanfeng Automotive Interiors, Pirelli, Brembo, and Eurogroup Laminations.

The potential impact of these tariffs on the automotive industry is significant. Automakers may be forced to raise prices, which could lead to decreased sales. Additionally, the tariffs could disrupt supply chains and lead to job losses.