Automakers Suspend Exports and Lay Off Workers
as Trump's Tariffs Take Effect
Some automakers are halting exports to the United States or laying off employees due to the impact of the Trump administration's auto tariff policies, causing damage to related industries.
On the 8th (local time), The New York Times (NYT) reported, "Car imports are already declining and factory operations are being suspended due to the impact of President Trump's tariffs."
According to the report, British luxury car manufacturer Jaguar Land Rover temporarily suspended shipments of vehicles to the United States for the month of April in response to the Trump administration's 25% tariff imposition. Stellantis, which owns brands such as Chrysler, Jeep, and Ram, also halted operations at manufacturing facilities in Canada and Mexico. As a result, 900 employees producing engines and other parts at those plants were temporarily laid off.
Additionally, German automaker Audi has recently withheld the release of vehicles arriving in the United States due to the burden of high tariffs. Since the auto tariffs took effect on the 3rd, Audi has kept vehicles unloaded at ports and plans to sell existing inventory within the U.S. first. Unlike other German companies such as Volkswagen and BMW, Audi does not have production bases in the United States. Its U.S. export volumes are produced in Mexico, Germany, Hungary, Slovakia, and other European countries.
As automakers respond to the Trump administration's auto tariffs, the NYT forecasts that if companies that have not yet taken concrete actions follow similar paths as Jaguar Land Rover, Stellantis, or Audi, the resulting economic shock could be even greater.
The NYT pointed out, "Widespread layoffs may occur and car prices could rise," adding, "Some models from Jaguar Land Rover or Audi could see price increases of up to $20,000 (approximately 30 million KRW) per vehicle due to the tariff impact."
Contrary to the Trump administration's expectations, it is also anticipated that automakers relocating their manufacturing bases to the United States will not happen in the short term. This is because it is difficult to make large-scale facility investment decisions, which could amount to trillions of won, amid uncertainty about how long the tariff policies will last. Lenny LaRocca, head of the automotive industry sector at global consulting firm KPMG, said, "So far, there has been no significant movement from companies. For now, the atmosphere is one of waiting and watching," adding, "Traditional methods alone will not be sufficient to respond to the tariffs."
LaRocca further analyzed that automakers are likely to focus on producing sport utility vehicles (SUVs) and pickup trucks, which can maintain profitability without passing tariff-related costs onto consumers.
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