How automakers are responding to Trump's tariffs, from discounted pricing to factory pauses

Yahoo

04-04-2025

Automakers are responding to Trump's latest round of auto tariffs, announced Wednesday.
Ford is offering customers an employee discount, while VW is adding an "import fee" to cars.
Stellantis has shut down factories and will lay off 900 workers, while others may shift production to the US.
The Trump administration's fresh wave of tariffs sent shock waves through the automotive industry on Thursday.
Automakers have responded to the impending trade war in various ways, from offering discounts to shoppers who hope to avoid future price increases to adding import fees on vehicles built outside the US.
The "draconian" trade policies, as one Wall Street analyst called them, will also affect autoworkers, with Stellantis pausing production at two assembly plants in Mexico and Canada.
Wall Street believes the tariffs could cost the auto industry more than $80 billion and slash Detroit's Big Three's earnings by up to 60%, thanks to an additional $5,000 of input costs per vehicle.
Here's how the industry at large is responding:
On Thursday, Nissan said it would pause new US orders of two Infiniti SUVs, which are built in Mexico. The announcement came after President Donald Trump's auto tariffs went into effect.
Nissan will pause new Mexico-built orders for the Infiniti QX50 and QX55 SUVs for US sales, the Japanese carmaker said in a statement to Business Insider. The model will still be produced for other markets, and production of other US models in Mexico and Japan will continue.
Nissan also said it would keep two shifts of production of the Rogue SUV at its Smyrna, Tennessee plant, reversing a January plan to end one of the shifts later this month. This will keep "more localized volume in the US that is free of the new auto tariffs," Nissan said in the statement.
Ford announced on Wednesday that it would make employee pricing available to consumers for the next two months.
"In times like these, talk is cheap. At Ford, we believe in action," Rob Kaffl, Ford's director of US sales and dealer operations, said in a press release.
The discount, which ends June 2, applies to all Ford and Lincoln models except Raptors, the 2025 Expedition and Navigator SUVs, and Super Duty trucks.
How much a consumer saves depends on the vehicle, but it could easily run into the thousands. The discount would be applied on top of any other deals or promotions a dealership is offering, the company said.
Ford declined to confirm whether the tariffs would lead to higher sticker prices.
A company spokesperson told Business Insider that it has a 74-day supply of vehicles in stock that haven't been affected by tariffs, compared to 50 days for GM and 24 days for Toyota. (Around 60 days of supply is considered healthy in a normal economic environment.)
Analysts say Ford is one of best best-positioned US automakers to weather the tariffs.
Stellantis, which owns former Chrysler brands like Dodge, Jeep, and Ram, has paused production at its Windsor assembly plant in Canada and Toluca assembly plant in Mexico, a spokesperson said Thursday.
The Windsor plant, which makes Pacifica/Voyager minivans and Charger Daytona EV muscle cars, will be offline for two weeks. It plans to resume operations the week of April 21.
The Toluca plant, which builds Jeep Compass and Wagoneer S SUVs, will stop work for the rest of April.
The production stoppage at these two facilities resulted in the temporary layoffs of 900 workers from the company's powertrain and stamping plants in Michigan and Indiana, the spokesperon said.
The German automaker Volkswagen has confirmed it will add an "import fee" to the sticker prices of vehicles affected by the tariffs, a spokesperson said. The import fee will be added to the destination charge, which is tacked onto the price of a new car.
It's unclear how much the tariffs will affect the cost of new VW cars as no final pricing decisions have been made, the spokesperson said.
Its top-selling Atlas and Atlas Cross Sport midsize SUVs are made in Chattanooga, Tennessee. Its other top sellers — the Jetta sedan, the Taos SUV, and the Tiguan SUV — are all made in Puebla, Mexico.
The CEO of Swedish brand Volvo Cars told Bloomberg on Thursday that the carmaker would look to build more vehicles at its South Carolina factory in response to the tariffs.
"We will have to increase the number of cars we build in the US, and surely move another model to that factory," said Håkan Samuelsson, who returned to Volvo as CEO on Monday.
Samuelsson said the company would "look closely" at which model it moves to the factory, which already builds the EX90 and Polestar 3 EVs. Volvo did not immediately respond to a request for comment from BI.
Mercedes-Benz also signaled that it was considering shifting production to the US. Production chief Jörg Burzer told reporters from multiple outlets that the German carmaker could start building another vehicle model in its Alabama factory.
Burzer said Mercedes was still "assessing" the impact of the tariffs but warned flexibility would be key. Bloomberg previously reported that the company was considering cutting sales of some of its least-expensive models from the US market because the tariffs would make them economically unfeasible.
A spokesperson for rival BMW told BI the luxury carmaker was also still "evaluating" the new levies but called on the US and Europe to reach a deal quickly to avoid further pain for consumers.
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