S&P Global Mobility Analysis: “Production Loss of About 20,000 Units Per Day”, [Oshawa (Ontario)] Amidst U.S. President Donald Trump’s imposition of a 25% tariff on imports from Mexico and Canada, automotive manufacturers are attempting to mitigate cost increase risks, and consumers are delaying new car and truck purchases, which could lead to a reduction of about a third of North American automobile production by next week. The photo shows a GM worker using equipment to weld a vehicle door at the General Motors (GM) assembly plant in Oshawa, Ontario.
According to an analysis by S&P Global Mobility, this production loss amounts to approximately 20,000 units per day. In the North American region, 25 automotive manufacturers produce an average of 63,900 passenger vehicles and small SUVs daily, with 65% assembled in the U.S., 27% in Mexico, and 8% in Canada. The impact of the tariffs varies by manufacturer, vehicle, and plant.
Stephanie Brinley, associate director at S&P Global Mobility’s Automotive Intelligence unit, noted, “Some plants will reduce shifts, and some will slow down production. This phenomenon does not affect all automotive manufacturers in the same way, as it depends on necessary parts, among other factors.”
Several U.S. auto manufacturers have refrained from direct commentary on the 25% tariff this week, maintaining previous positions or expressing their stance through trade associations. The American Automotive Policy Council (AAPC), which represents Ford, General Motors (GM), and Stellantis, argued that vehicles and parts meeting the strict rules of origin under the United States-Mexico-Canada Agreement (USMCA) should be exempt from the tariffs.
In a statement released on the 3rd, Matt Blunt, AAPC Chairman and former Missouri Governor, said, “Our American automotive manufacturers have invested billions to meet these requirements. The current tariffs will increase production costs within the U.S., hinder investment in U.S. labor, and grant benefits to foreign competitors by providing easier access to our market.”
The Alliance for Automotive Innovation (AAI), which represents most U.S. auto manufacturers, stated, “All automotive manufacturers will be impacted by the tariffs on Canada and Mexico. Prices for some car models are anticipated to rise by up to 25%, with immediate negative effects on vehicle prices and supply.”
Brinley remarked, “The automotive industry has rarely experienced such a volatile situation. Although the industry has become somewhat more agile after dealing with unexpected events like the COVID-19 pandemic and supply chain issues in recent years, significant uncertainty remains.”