The 25% Tariffs that have been stipulated by US President Donald Trump on imports from Mexico and Canada have left the majority of car manufacturers in a whirlwind of selecting new locations for Production. But Volkswagen has a decisive plan to avoid the Tariffs. As per a recent report Volkswagen has shared that its vehicles made in North America would likely avoid Being subjected to 25% tariffs. Other brands such as BMW and a few others might not be exempted from the levied duties.
Trump has provided one-month reprieve on Tariffs to automakers who had production units or any other relation that came under the ambit of United States- Mexico and Canada agreement rules of origin this week. The Tariffs were to be in effect on March 4, but which automakers would end up being subject to tariffs is not clear as of yet.
Volkswagen’s Reaction
A spokesperson from Volkswagen said that its North American Vehicles do not comply with the Terms that have been levied under USMCA. Further, a spokesperson from BMW spoke on the matter and said that vehicles that are being imported from the United States and Mexico do not comply with the rules of the Trade, these issues subject them to steep duties. He further stated that about 10% of BMW’s US sales are imported from Mexico, the spokesperson said.
German carmakers would supposedly get impacted the most. Since Volkswagen is a big brand a few of its brands might land paying big tariff fees. The brand’s subsidiaries such as Audi, and Porsche have no US manufacturing base. VW passenger car brand’s US sales consist mainly of imports from the Mexico plant and beyond that the brand cell plant that was under construction in Canada was set to deliver Batteries to EV’s has come under the grasp of new tariffs as well. Audi has a plant in Mexico as well, the plant is known for producing Audi Q5SUV for its US sales.
