GM, Ford and Stellantis would be heavily impacted by Mexico-Canada import taxes
- The United States imports roughly 40% of the vehicles of the vehicles sold on its soil each year. These imports come primarily from Mexico and Canada, as the three former major American carmakers (GM, Ford, Chrysler) chose several decades ago to relocate part of their automotive production to these two countries. Mexico offers cheap labour, and Canada allows expansion of production congestion beyond Detroit, a city also close to Canada. Japanese carmakers established in the United States quickly followed the move.
- In 2024, out of 16 million new vehicles (passenger cars and light utility vehicles) sold in the United States, 6.4 million came from outside the country, including 2.36 million from Mexico, 1.16 million from Canada, 1.07 million from South Korea, 900,000 from Japan and 900,000 from Europe. These 6.4 million vehicles should therefore be subject to 25% additional tariff (on top of existing tariffs) from the Trump administration.
- The carmakers that import the most to the USA are the Toyota groups (1.09 million units in 2024), GM (1.05 million), Hyundai-Kia (0.87 million), Volkswagen (0.53 million), Honda (0.44 million) and Stellantis (0.41 million).
- But those that import the most from Mexico and Canada are the Toyota groups (0.75 million units), GM (0.69 million), Honda (0.44 million), Ford (0.37 million) and Stellantis (0.37 million).
- In total, 1.4 million GM, Ford, and Stellantis vehicles from Mexico and Canada would be affected by the 25% import tariffs, not to mention 1.6 million vehicles from Japanese carmakers from these two countries. The Trump administration's wish would, of course, be to relocate these 3 million vehicles to the United States, which could not be done in the rush and provided that carmakers agree to do so, which may lead to plants capacities reduction or even closures in Mexico and Canada.