Trump tariffs drive potential 9% dip in 2025 car production
Analysts predict that car production in North America may decrease by 9% in 2025. This decline is attributed to tariffs imposed by President Donald Trump, which are raising vehicle prices and influencing manufacturers' decisions.
According to the S&P Global Mobility report, global production of new cars this year will be 87.9 million, a 2% decrease from the previous year, translating to about 1.55 million fewer units. The American market could be particularly affected, with a projected 3% drop in sales.
The tariffs imposed by the Trump administration increase costs for both consumers and manufacturers. About 50% of new cars sold in the US are produced abroad, and between 30% to 60% of car parts are imported. In response, some companies, such as Audi and Jaguar Land Rover, have halted exports to the United States, relying on existing stock and hoping for tariff relief in the coming months.
Other manufacturers are opting to relocate production to the US. Volvo has announced the start of production for a second model in the country, likely the XC60 or XC90 in hybrid versions. Honda plans local production of the Civic Hybrid model, and Mercedes-Benz intends to increase its capacity in the United States, although this may take several years.
Meanwhile, the CEO of the VW Group, Oliver Blume, revealed that Audi is in talks with the Trump administration about opening a factory in the US. Although Volkswagen already has plants in the country, all Audi models sold locally are imported.
