Tariffs on Mexican and Canadian Auto Imports Threaten Industry

Mexico and Canada Face 25% Tariffs

U.S. President Donald Trump has threatened to impose 25% tariffs on imports from Mexico and Canada if they fail to address the flow of fentanyl into the United States.

Impact on Automakers

Approximately 90% of auto exports from Mexico and Canada go to the U.S. German automakers, including Volkswagen, have expressed concern, warning that tariffs would lead to consumer inflation.

Affected Automakers

Audi

* Plant in San Jose Chiapa, Mexico
* Produces Q5 SUVs
* Employs over 5,000 people
* Exported nearly 40,000 units to the U.S. in the first half of 2024

BMW

* Plant in San Luis Potosi, Mexico
* Produces 3 Series, 2 Series Coupe, and M2 models
* Majority of output exported to the U.S. and global markets
* Plans to produce the Neue Klasse electric vehicle line from 2027

Ford

* Three plants in Mexico: Chihuahua engine plant, Cautitlan and Hermosillo assembly plants
* Exported nearly 196,000 cars from Mexico to North America in the first half of 2024, with 90% going to the U.S.
* Plans to produce a larger F-Series pickup truck in Oakville, Canada from 2026

General Motors (GM)

* Imported roughly 750,000 vehicles from Mexico and Canada (mainly Mexico) in 2024
* Key vehicles produced in Mexico include the Chevy Silverado and GMC Sierra pickups, and mid-sized SUVs
* Mexican plants produce the Equinox and Blazer electric SUVs
* Three plants in Canada: electric van production, Silverado Heavy Duty truck production, and engine and transmission production

Honda Motor

* Sends 80% of Mexican output to the U.S.
* Warned of potential production shifts if tariffs are imposed

JAC Motors

* Joint venture with Mexican firm Giant Motors
* Assembles JAC vehicles and Hyundai Santa Fe SUVs for export to the U.S.

Kia Corp

* Plant in Mexico
* Produces its own vehicles and Santa Fe SUVs for Hyundai Motor export to the United States

Mazda

* Exported around 120,000 vehicles from Mexico to the U.S. in 2023
* May reconsider investments if tariffs are imposed

Nissan Motor

* Two plants in Mexico
* Produces Sentra, Versa, and Kicks models for the U.S. market
* Produced nearly 505,000 vehicles in Mexico in the first nine months of 2024

Stellantis

* Two assembly plants in Mexico: Saltillo and Toluca
* Produces Ram pickups, vans, and Jeep Compass SUVs
* Two assembly plants in Ontario, Canada: Windsor and Brampton

Toyota Motor

* Builds Tacoma pickups at two plants in Mexico
* Sold over 230,000 Tacoma pickups in the U.S. in 2023, accounting for 10% of its market share
* Used to produce the Tacoma in the U.S., but now imports all units from Mexico

Volkswagen

* Largest auto plant in Mexico and one of the largest in Volkswagen Group in Puebla
* Produced nearly 350,000 cars in 2023, including Jetta, Tiguan, and Taos models, all exported to the U.S.
* Building a battery gigafactory in St. Thomas, Ontario, Canada

Auto Suppliers

* Autoliv: Airbag and seat belt manufacturer with 15,000 employees in Mexico
* Michelin: Tyre manufacturer with plants in Mexico and Canada
* Yanfeng Automotive Interiors: Seat manufacturer supplying General Motors and Toyota from its Mexican plants
* Pirelli: Italian tyre manufacturer with plants in Mexico
* Brembo: Italian premium brake manufacturer with plants in Mexico
* Eurogroup Laminations: Italian stator and rotor manufacturer with a Tesla partnership