Some Automakers Are Trying To Wait Out Tariffs
As the first full week of U.S. tariffs unfolds, the auto industry still isn't quite sure what to make of it all. This is particularly true for automakers based outside the U.S. with little or no manufacturing presence on American soil.
Key Points
- Audi, Volkswagen, Porsche, Jaguar Land Rover, and Lotus are among the automakers halting U.S. vehicle shipments in response to the newly imposed 25% tariffs on imported vehicles.
- The pause comes as they await clarity on the long-term impact of the tariffs and adjust strategies as tariffs may impact pricing and production of vehicles.
- The situation remains fluid, with the possibility that tariffs could be altered or canceled.
The 25% tariff imposed on cars crossing the U.S. border is substantial especially as new vehicle average transaction prices rise towards the $50,000 mark. Some brands are opting to halt shipments temporarily in hopes that this all might just go away.
According to a report from Automotive News, Audi has informed dealers that all vehicles bound for the U.S. are currently on hold. Cars arriving at U.S. ports after April 2 will remain there until further notice. Vehicles that arrived before April 2 will be processed and sent to dealerships as usual without any additional tariff charges—except they will be marked with a special sticker to indicate exemption.
Audi doesn't know when it plans to resume shipments, but once it does, some of its highest volume models—such as the Audi Q5—could be subject to tariffs as high as 50%. The Q5 is built in Mexico, but it doesn't comply with the U.S.-Canada-Mexico trade agreement, meaning it could face a double tariff.
This could be a broader strategy play across the Volkswagen Group, as Volkswagen and Porsche have also reportedly paused shipments, with no specific timeline for when shipments will resume.
Outside of Germany, Jaguar Land Rover (JLR) has confirmed to Reuters that it is pausing shipments to the U.S. for one month and Lotus has apparently paused shipments indefinitely, according to a report from Car and Driver. Lotus has not provided an official statement.
Since U.S. President Donald Trump first announced the 25% tariffs, the situation has been nothing but sound and fury. While tariffs were initially proposed and then quickly walked back, the current tariffs that went into effect on April 3 seem more permanent, although there is still the potential for a cancellation at any time—it's clear that some automakers are hoping and praying for exactly that.
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An experienced automotive storyteller and accomplished photographer known for engaging and insightful content. Michael also brings a wealth of technical knowledge—he was part of the Ford GT program at Multimatic, oversaw a fleet of Audi TCR race cars, ziptied Lamborghini Super Trofeo cars back together, been over the wall during the Rolex 24, and worked in the intense world of IndyCar.
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