- Carmakers won’t evenly be impacted by President Trump’s tariffs against Mexico and Canada.
- Some US companies rely heavily on Mexico or Canada to produce and import their cars.
- Even those with a strong US presence, such as Tesla and Rivian, will still feel the effects.
For American automakers, the consequences of President Donald Trump’s tariffs are likely unavoidable, even for those with a strong US manufacturing presence, such as Ford, Rivian, and Tesla.
A 25% levy on incoming goods from Canada and Mexico will impact almost all US carmakers because they’ve come to rely on their North American partners for not just large tasks such as vehicle assembly but also for smaller components such as engines, seats, and wiring.
The effects won’t be even across the board.
General Motors, for example, could feel more of the blow from Trump’s tariffs than others. In 2024, GM produced nearly 900,000 vehicles in Mexico, according to Statista data.
GM CEO Mary Barra said in an earnings call in January that the automaker has measures that it could take to soften the impacts of tariffs, in part by looking toward its other international sources.
“So there’s plays that we can do on that perspective to minimize the impact if there are tariffs either on Canada or Mexico,” Barra said at the time.
A spokesperson for GM did not respond to a request for comment.
US carmakers pivot
Even companies that manufacture most, if not all, of their cars in the US will have to strategize around mitigating the costs of tariffs.
Final assembly for Teslas, for example, takes place in the US. Still, a filing from the National Highway Traffic Safety Administration shows that between 20% and 25% of the components from Tesla’s 2025 model-year vehicles come from Mexico.
“There’s a lot of uncertainty around tariffs,” Tesla’s Chief Financial Officer Vaibhav Taneja said in an earnings call on January 29. “Over the years, we’ve tried to localize our supply chain in every market, but we are still reliant on parts from across the world for all our businesses. Therefore, the imposition of tariffs, which is very likely, and any will have an impact on our business and profitability.”
Rivian, an EV startup based in southern California, also produces pickup trucks and SUVs in Illinois, with another Georgia plant planned for construction.
Still, CEO RJ Scaringe recognized the importance of Mexico’s role in the US auto industry during a roundtable interview with reporters in January. He has also said that the company has been bracing for tariffs from the Trump administration.
“The auto industry, uniquely for the United States, is dependent on Mexico as a source of a lot of our supply chain. That’s sort of been built over many, many decades,” he said, adding that the sourcing will need to be “remapped” if tariffs were implemented.
Vidya Rajagopalan, Rivian’s senior vice president of electrical hardware, told reporters during a tour of the company’s Palo Alto office that contract manufacturers haven’t “been sleeping” and will start to ramp up sourcing in Vietnam or other countries not levied with tariffs.
Spokespeople for Tesla and Rivian did not respond to a request for comment.
Ford might not feel the effects of Trump’s tariffs as much as its legacy counterpart, GM, even though it, too, produces some of its vehicles in Canada and Mexico. The Bronco Sport, Maverick, and Mustang Mach-E are assembled south of the border. The company announced last year that it would assemble its F-Series Super Duty pickup trucks in Ontario, Canada, starting in 2026.
At the Barclays Global Automotive and Mobility Tech Conference in November, Ford’s Chief Financial Officer John Lawler said that the carmaker is the “number one producer in the US,” but the impacts of tariffs will be uncertain.
“Remember, it’s four years,” Lawler said at the time, appearing to reference the length of Trump’s second term, “and we don’t know how lasting this will be.”
A Ford spokesperson did not respond to a request for comment.
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