German auto industry to expand production in the U.S. to circumvent customs duties


02/24/2025

Leading German car manufacturers have devised strategies to restructure their production facilities to reduce the impact of anticipated tariffs on vehicles in the United States. Reuters has discovered that Audi and Mercedes-Benz perceive an opportunity in increasing their production in the United States.



Marek Ślusarczyk
Audi currently lacks its own manufacturing facility in the U.S. and intends to start assembling several of its most popular models in that region. The company is set to reveal the selected site for the factory later this year, said the company’s CEO Gernot Döllner.

Mercedes-Benz plans to enlarge its manufacturing plant located in Alabama, USA. Simultaneously, BMW, which also manufactures in the U.S., thinks it can operate as it currently does. BMW CEO Oliver Zipse stated that they have extensive production facilities in the U.S. and maintain strong ties with the leaders of South Carolina, the state hosting this production.

In 2024, the three leading German car manufacturers represented 73% of EU vehicle exports to the US. As stated by Guillaume Dejean, an automotive market specialist at Allianz Trade, “regardless of the outcome of this trade war, German automakers will likely be the losers in nearly every scenario.”

source: reuters.com