Measures implemented by original equipment manufacturers to mitigate the impacts of tariffs

In the midst of ongoing tariff disputes, the automotive industry in the United States is adapting to a shifting landscape. Here's a roundup of significant investments, adjustments, and strategic moves by some of the world's leading car manufacturers.

General Motors (GM) has announced a $4 billion investment in US vehicle production, expanding its operations in Michigan, Kansas, and Tennessee. The move comes as part of a broader strategy to minimise the impact of tariffs on imports. In a separate development, GM also revealed plans to move some electric vehicle production from Canada to the United States.

Hyundai has committed to investing $21 billion in US vehicle manufacturing, supply chain, and logistics until 2028. To further mitigate the financial impacts of tariffs, Hyundai has also established a tariff task force and announced a $5.8 billion Hyundai Steel plant in Louisiana to supply steel to its plants in Alabama and Georgia.

Toyota has made a significant move by announcing a $14 billion investment in a battery plant in North Carolina, marking its first in-house battery plant outside of Japan. Additionally, Toyota plans to move some production of its GR Corolla model to the UK to take advantage of reduced tariffs.

Ford, Stellantis, and GM have spoken with the President to ask for exemptions for carmakers from tariffs. Meanwhile, Volkswagen Group (VW Group) and its Audi division have halted vehicle exports to the US from Europe and Mexico, while holding vehicles at US ports of entry. Mitsubishi has temporarily paused vehicle exports to US dealerships, also holding vehicles at ports while awaiting clarity on duties.

In response to the tariffs, some manufacturers have chosen to shift production to the US. Honda has announced it would shift some of its CR-V model production from Canada to the US to minimise tariff impact. Volvo Cars has decided to increase the utilisation of its US plant in Charleston to reduce the effects of import tariffs.

Rivian, a leading electric vehicle manufacturer, has announced a $120 million investment into a supplier park in Illinois to help localize its supply chain. Nissan, on the other hand, has suspended production of three models for the Canadian market at two US plants in July.

Jaguar Land Rover (JLR) initially paused exports to the US for one month once tariffs on vehicle imports came into effect in April. However, the company has not made any further announcements regarding its export strategy. Mercedes-Benz, another global player, has reportedly been stockpiling inventory in the US while evaluating strategies to deal with tariffs.

The US has implemented 50% tariffs on India, which may have implications for the automotive industry. However, details regarding specific adjustments or investments by Indian car manufacturers in response to these tariffs have not been disclosed.

As the automotive industry continues to navigate the complexities of tariffs, it remains to be seen how these strategic moves will shape the future of vehicle production in the United States and beyond.