From Victoria Waldersee
Berlin (Reuters) -volkswagen’s Audi will expand production in North America, and Mercedes will increase their production of US American products, while European car manufacturers are trying to protect themselves from the tariff threats of US President Trump.
Trump has erected tariffs on aluminum and steel and threatened 25% of imports on imports from Mexico and Canada, as well as all cars and semiconductors, which will hit the finances of European car manufacturers when they are already struggling to crash high costs in the market and fight against competitions from China.
The US tariffs are expected to be high on the agenda when EU trade chief Maros Sefcovic meets representatives of the car industry on Friday, as well as suppliers and Bruxelles battery producers to discuss dishonest trade practices and access to the market for companies in the region.
The shop chief met with American colleagues in Washington earlier this week and said he saw a willingness to reduce the tariffs on both sides.
Meanwhile, car companies are progressing with their own plans.
Volkswagen’s Audi, who currently does not have a production base in the United States, plans to make his most important cars for the US market in the region, and this year he will publish a specific place, said his Reuters CEO.
Mercedes-Benz CEO Harald Wilhelm told investors on Thursday that the luxury brand, which exports high-speed vehicles and sedans to the United States from Europe, will localize more production in his Tuscaloosi, Alabama plant to protect himself from growing trade tensions.
European car manufacturers have carried out about 800,000 vehicles in the United States last year, according to official data from US stores, about four times more than the number of cars that have now taken to Europe.
And a large part of the export of American car comes from European car manufacturers, leaving them in an account for 10% EU tariffs to import cars from US BMW, for example, sends about 90,000 cars from his Spartanburg factory in southern Karolina to Europe.
The large three German car manufacturers made up 73% of EU car exports in the US last year, according to the Jato Dynamics research platform.
“No matter what screw in the trade war, the German car manufacturers are almost always losers,” said Guillaume Dejean, an auto industry expert in Allianz Trade, in a research note.
Mercedes-Benz and BMW, who are both of the main exporters from the US, have American production that gives them greater flexibility to divert the output and create a place for local sales.
The BMW’s main clerk said that earlier this week the car manufacturer had no need to negotiate a special agreement for the exemption from US tariffs, pointing to his great presence of USA -good relations with the State Government officials in South Carolina, his home Spartanburg factories.
