Donald Trump may have scored a major own goal with his tariffs on US car imports as analysts say Detroit's 'Big Three' manufacturers are more exposed than prominent German and Japanese rivals.
While the 25 per cent levy has been applied broadly as part of the President's new trade policy intended to boost domestic carmakers, some synonymous with America's automotive heritage will be impacted negatively.
Detroit’s General Motors, Ford, and Stellantis - parent group of Jeep, Dodge, Ram, and Chrysler - are particularly vulnerable, according to market analysis by UK-based automotive intelligence company Jato Dynamics.
The three manufacturers collectively sold approximately 1.85million imported cars in the US last year, accounting for 13 per cent of their combined global sales.
In comparison, Toyota, Honda, and Nissan – the three largest Japanese brands – sold 17.9million units globally last year. Of this total, 1.53million units were imported and sold within the US market, equating to just 9 per cent.
For Germany’s Volkswagen Group, BMW Group, and Mercedes Benz, US demand for their imported cars accounted for only 7 per cent of their combined global total.
'With a smaller global presence than some of their Japanese and European counterparts, US manufacturers rely heavily on domestic sales, meaning that tariffs on cars imported largely from Mexico, Canada, and Korea will be felt keenly,' Jato Dynamic's report said.
Detroit’s General Motors, Ford, and Stellantis - parent group of Jeep, Dodge, Ram, and Chrysler - are particularly vulnerable, according to market analysis by automotive intelligence company Jato Dynamics
A 25 per cent import tariff on all US car imports was confirmed by Trump in his Liberation Day announced a week ago today.
The imposition of tariffs on global imports has sent the automotive industry into a frenzy over the last seven days, with the likes of Volkswagen holding cars at US ports, Jaguar Land Rover pausing deliveries across the Atlantic while it seeks to 'address the new trading terms', and JLR rival Ineos Automotive hiking the price of its Grenadier in the US by 5 per cent with immediate effect.
It has also forced the hand of Sir Keir Starmer to this week water down the UK government's EV sales targets in the lead up to the ban on sales of new petrol and diesel cars in 2030, with the PM stepping in to help shied British manufacturers from Trump's levies and its threat to an estimated 25,000 UK jobs.
But it has also triggered major disruption for US brands.
Last week, Stellantis announced it will furlough 900 employees and pause production in multiple factories as it worked through its tariff response.
Ford, which had a higher-than-average stock of vehicles, said it was offering employee discounts to customers.
GM also confirmed it will ramp up US-based production of its range-topping pick-ups.
Trump's decision to levy tariffs on imports is made all the more painful for the sector as it comes at a time of heightened issues for the automotive industry.
While the 25% levy has been applied to US car imports broadly as part of the President's trade policy intended to boost domestic carmakers, some synonymous with America's automotive heritage will be impacted negatively
Stellantis, the parent group of Jeep, Dodge, RAM and Chrysler, last week confirmed it was temporarily laying off 900 employees and pausing production at factories
Ford, which had a higher-than-average inventory of vehicles, said it was providing employee discounts to customers, offering buyers thousands of dollars off as competitors hike prices to absorb tariff costs
General Motors recently confirmed it will ramp up US-based production of its range-topping pick-ups. Pictured: Vehicles on the assembly line at GM's plant in Fort Wayne, Indiana
Other factors at play include falling demand for foreign vehicles in China and stifled growth and regulatory pressures in European markets.
Felipe Munoz, global analyst at Jato Dynamics, said Trump's tariffs are 'yet another problem for the industry to navigate'.
He explained: 'The US is the world’s second-largest vehicle market, and it will now be more difficult than ever for the vast majority of non-Chinese automakers around the world to trade.'
The intelligence groups reveals that 16.1million new light vehicles were sold in the US in 2024.
Around 6.3million were largely imported from Mexico, Canada, the European Union, the UK, Japan, and Korea – all of which will face a 25 per cent tariff when exporting vehicles to the US.
In addition, from 3 May 2025, these measures will be broadened to include automotive parts produced outside the country, presenting another major headache for both American and non-US makers.
With a smaller global presence than some of their Japanese and European counterparts, US manufacturers - like GM (HQ in Detroit, Michigan pictured) rely heavily on domestic sales, meaning tariffs on cars imported from Mexico, Canada, and Korea will be 'felt keenly'
These are the non-US 'mainstream' brands most likely to be impacted by the tariffs, according to Jato Dynamics
'Few will benefit from the imposed tariffs, but some brands will suffer more than others,' Jato Dynamics warns.
For example, Mazda, Subaru, and General Motors are most reliant on imports into the US.
Mazda sold 1.28million new cars globally in 2024; some 343,000 of these were vehicles imported and sold in the US.
Meanwhile, the US accounted for 71 per cent of Subaru’s total car sales in 2024.
While a large portion of these vehicles were produced at its factory in Indiana, imports into the US still made up a quarter of the brand’s total volume globally.
General Motors is highly dependent on the US market, too,
It ranks just behind Hyundai-Kia and Toyota in total vehicle imports in 2024.
GM's global footprint is largely concentrated in North and South America, China, and a few smaller markets.
Notably, sales of imported vehicles in the US made up 18 per cent of GM’s total global sales. That was the highest percentage among the world’s five largest automakers, the analysis shows.
As for luxury brands, Britain's McLaren, Bentley, Aston Martin and Rolls-Royce have among the highest total percentage of global sales delivered to the US.
However, given their unique attraction (certainly against the lack of like-for-like US options) and desirability among the wealthiest buyers, experts have said any price increases imposed are likely to be swallowed by customers.
The imposition of tariffs on global imports has sent the automotive industry into a frenzy over the last seven days, with the Volkswagen Group holding cars at US ports
As for luxury brands, Britain's McLaren, Bentley, Aston Martin and Rolls-Royce have among the highest total percentage of global sales delivered to the US
The report also examined which automotive giants will need to have a sizable strategy change due to their reliance on the American market.
Volkswagen Group - which sells models from VW, Audi, Bentley, Lamborghini, Bugatti and Rimac in the US - is one of these.
In 2024, the Americas made up less than 10 per cent of Volkswagen Group’s global sales.
As a result, the German manufacturer, alongside Honda, is less exposed than other major carmakers; however, this level of protection will be offset by the fact that vehicles made abroad account for approximately 80 per cent of its sales in the US.
Munoz added: 'The US is a vital market to 14 of the 18 non-Chinese global carmakers.
'For the likes of Volkswagen, the US contributes a relatively small amount of the brand’s total revenue, but it will seek to hold a presence to retain its position as a global brand.'
Alongside Volkswagen, other brands also likely to need to increase their production footprint in the US in the near future includes Volvo, Hyundai-Kia, Mercedes, BMW, Stellantis, Toyota, Nissan, Subaru, and General Motors.
'The US is a market that they can’t leave,' Munoz says.
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