Stellantis is considering a revision of its manufacturing expansion into Mexico in response to potential tariffs proposed by President-elect Donald Trump, reported Bloomberg.
Stellantis Ram brand head Chris Feuell has acknowledged the possibility of changing the company’s factory and supplier networks to mitigate disruptions from new trade policies.
Go deeper with GlobalData
Feuell was cited by the publication as saying in an interview at the Los Angeles Auto Show that: “It’s obviously part of all the scenario planning we’re doing.”
She said that no decisions have been made.
The automotive sector faces significant risks from Trump’s proposed tariffs, which could impose a 60% levy on Chinese goods and 20% on imports from other countries.
Stellantis is expanding its pickup truck plant in Saltillo, Mexico to produce some Ram 1500 trucks next year. It also produces heavy-duty Ram trucks and commercial vans.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalDataHowever, the move has already drawn criticism from the United Auto Workers Union due to job cuts in the US.
Trump has vowed to penalise automakers who import cars to the US from Mexico.
The latest move forms part of Stellantis’ strategy to shift more of its manufacturing base outside of the US to nations with lower costs.
Stellantis’s profit drop in the first half of 2024 has led to layoffs and production adjustments, with 1,100 workers being laid off at its Warren plant in Michigan.
Last week, Reuters reported a potential removal of a $7,500 consumer tax credit for EV purchases by the President-elect Donald Trump’s transition team.
Feuell said that this move could pose an additional threat to the adoption of Stellantis’s EVs.
Feuell added: “It’s important to stay true to our strategy. If we need to pivot with regard to the mix that those products represent, then that is certainly an option for us to take a look at.”
