Trump’s tariffs faced widespread criticism, yet they may achieve their intended goal, with the VW Group, for one, now considering local production of Audis
- Trump’s tariffs aim to reduce imports and push manufacturers to build in the US.
- VW Group’s CEO revealed Audi is considering building a factory in the States soon.
- Company execs are negotiating with US officials to strike a beneficial deal for Audi.
President Trump has long argued that the tariffs he imposed on imported goods would ultimately benefit the United States, suggesting that most companies would prefer to manufacture their products locally rather than raise prices significantly. In some cases, he might actually be onto something. The VW Group, for example, is reportedly in talks with the Trump administration about just that.
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The key player in this discussion is Audi, a brand that, unlike Volkswagen, doesn’t have a US plant. As a result, it imports most of its cars from Europe, except for its best-seller, the Q5, which is built in Mexico and now faces crushing tariffs . However, that could change, as revealed by the group’s CEO, Oliver Blume.
In Talks with the US Government
In an interview with the Frankfurter Allgemeine, Blume confirmed that the company is in negotiations with the Trump administration to build an Audi factory in the States: “We have a forward strategy with exciting project approaches, tailor-made and attractive to the US market”, he said. “We throw that into the scale. Constructive talks are currently underway with the US government.”
Blume is definitely aware that the American market is a very important one for Audi, which has currently paused shipments due to the new tariffs imposed on imports. If those stay in place, the German company will have to build its cars in the US, as walking out is simply not an option.
“We want to continue expanding. The Volkswagen brand has opportunities in its product portfolio. For Audi, US production would be a step in the development of our strategy,” said Blume.
Porsche’s Strategy is Different
While Audi looks to set up shop in the States., Porsche, another VW Group brand, has no such plans. Despite being part of the same group, Porsche delivers far fewer cars to the U.S. market, and being a luxury brand with a wealthier clientele means that price increases would likely have a minimal impact on sales.
If the negotiations end with an agreement, then some US-market Audis will be made locally. However, it won’t happen overnight; building a new plant takes time, and the VW Group is currently dealing with issues in Europe and China.
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That’s something Trump himself acknowledged, saying that it’s time consuming for car companies to build plants and find new suppliers. Perhaps it’s also an indication that the President is willing to give automakers like the VW Group an exemption so they can construct their local factory.
