Trump’s Canada and Mexico Tariffs Could Hurt Some Carmakers

Almost all automakers are going to feel a pinch from the new tariffs imposed by President Trump on Saturday on goods imported from Canada, Mexico and China.

Auto manufacturers ship tens of billions of dollars worth of finished automobiles, engines, transmissions and other components each week across the U.S. borders with Canada and Mexico. Billions of dollars more are imported from parts manufacturers in China.

The tariffs, which will take effect at 12:01 a.m. on Tuesday, are widely expected to raise the prices that American consumers pay for new automobiles. And the tariffs come at a time when new cars and trucks are already selling for near record prices.

General Motors, the largest U.S. automaker, will probably be most affected.

G.M. produces many more vehicles in Mexico than any other manufacturer — over 842,000 in 2024, according to MarkLines, an auto-industry data provider. And some of those vehicles are the most important in the company’s lineup.

All of the Chevrolet Equinox and Blazer sport-utility vehicles G.M. sells in the United States come from Mexico. The Chevrolet Silverado pickup truck, a top-selling model, and the similar GMC Sierra pickup generate huge profits for the company. Of the more than one million of those trucks built last year, nearly half were produced in Canadian and Mexican plants, data from MarkLines shows.

All told, G.M. plants in Canada and Mexico produced nearly 40 percent of all vehicles the company made last year in North America, the region where it gets most of its revenue and almost all of its profits.

Several other automakers, including Stellantis, Toyota and Honda, also make about 40 percent of their North American cars and trucks in Canada and Mexico but they produce fewer vehicles than G.M. So most automakers may not feel the impact of the tariffs as acutely as G.M.

“Tariffs are a very, very big threat to manufacturers and to auto manufacturing states,” said Patrick Anderson, chief executive of Anderson Economic Group, a consulting firm based in Michigan. “And clearly, G.M. is more vulnerable than most automakers because of the manufacturing footprint it has in North America.”

Mr. Anderson said the most immediate impact of the tariffs will be delays and confusion at the border crossings as customs agents, shippers, and ports try to sort out how to deal with the vehicles and parts that are already on trucks and trains headed for the border.

He estimated that the tariffs could add $10,000 or more to trucks and other larger vehicles that are shipped into the United States from Canada and Mexico. “Much of that, at least in the short term, is going to get absorbed by customers and auto dealers,” he said.

Manufacturers will have to seek ways to shift and adjust production to avoid or limit the burden of the tariffs, he added.

Few automakers have spoken out about President Trump’s plans. Auto executives have acknowledged that they are hesitant to say anything substantive about tariffs because they don’t want to anger Mr. Trump and invite retribution from him, his aides and other federal officials.

The lobbying group representing the three Detroit automakers, the American Automotive Policy Council, issued a statement, saying that vehicles and parts that comply domestic and regional content rules of the United States-Mexico-Canada Agreement should be exempt from tariffs.

“Our American automakers, who invested billions in the U.S. to meet these requirements, should not have their competitiveness undermined by tariffs that will raise the cost of building vehicles in the United States and stymie investment in the American work force,” Matt Blunt, president of the group, said.

Jennifer Safavian, the president and chief executive of Autos Drive America, a lobbying group representing foreign-owned automakers with operations in the United States, said in a statement that “the North American auto industry is highly integrated and the imposition of tariffs will be detrimental to American jobs, investment and consumers.”

G.M. has been looking at several steps it could take to soften the impact of tariffs, such as increasing pickup truck production in the United States, and using its Canadian and Mexican factories to export vehicles to countries outside North America.

“We’re doing the planning and have several levers that we can pull,” the company’s chief executive, Mary T. Barra, said this past week in a conference call to discuss G.M.’s 2024 financial results.

Mark Wakefield, global automotive market lead at AlixPartners, a consulting firm, said tariffs could lead to job losses at auto and auto parts factories across North America as manufacturers scramble to respond.

“North America has really been treated as one market by the auto industry for decades now,”…