Published on: February 2, 2025 / update from: February 2, 2025 - Author: Konrad Wolfenstein
Battery storage and automobile: The punitive tariffs of US President Donald Trump against Mexico and Canada also meet Germany-Image: Xpert.digital
The effects of the new US criminal duties against Canada and Mexico on the German economy
Trade policy measures and their consequences
The recent trade policy measures in the United States have far -reaching consequences - not only for the North American market, but also for the German economy. Since February 1, 2025, new punitive tariffs have been in place by US President Donald Trump. Imports from Mexico and Canada are occupied with 25 %, while additional Chinese goods are removed with 10 %. However, these measures are part of a strategy to protect domestic industries, but also have international effects, which are particularly evident in the globally networked automotive industry.
Effects on the German automotive industry
The German automotive industry, which has lived on global production and supply chains for years, is severely affected by these tariffs. Many of the leading manufacturers have established production locations in Mexico to secure access to the huge US market. Volkswagen is particularly the focus. The works based in Mexico, in which models such as the Tiguan and the Atlas are produced for export to the USA, risk significant financial losses. Experts estimate that up to 15 % of the operational profit - around 3 billion euros - could be at risk from the new tariffs. Audi, which receives around 40 % of its US exports from Mexican facilities, and BMW, which are also integrated into this market, also feel the pressure of the trading policy measures.
Challenges for future projects in Canada
Another focus is Canada. Volkswagen plans to build a battery cell factory in Ontario in 2027 in Ontario, which should play a key role in future electromobility. However, the punitive tariff could significantly question the profitability of this ambitious project. A stable and cost -efficient production of battery cells is of crucial importance in times of global change towards environmentally friendly drive technologies. The imponderables in trade processing could therefore not only slow down the automotive sector, but also the entire energy transition.
Increasing production costs and their consequences
The tariffs also have a direct impact on production costs. Vehicles that are manufactured in Mexico could become around $ 6,000 more expensive. These additional costs not only affect the manufacturers' profit margins, but are ultimately passed on to the end users. "Higher production costs inevitably mean higher final prices," often says in industry circles. At the same time, counter-tariffs from Canada and Mexico make it difficult to provide a 25 % customs duty on US products that are already complex North American supply chains. Not only end products, but also components produced in the USA that are used in the manufacturing processes are also burdened.
Production shift in response to trade conflicts
Due to these pricing and competitive effects, German manufacturers are forced to realign their strategies. There is a trend towards relocating production: BMW and Mercedes already have works in the USA, while Volkswagen expanded its capacities in Tennessee to cushion the effects of punitive tariffs. These measures reflect the need to react more flexibly to geopolitical changes. However, there is also the challenge in the room to maintain the longstanding synergies in the global production networks and at the same time minimize the risks due to geopolitical tensions.
Economic consequences and labor market
The situation also harbors serious economic consequences. Experts were before that in the event of a further escalation of the transatlantic trade conflict, well over 100,000 jobs in Germany could be endangered in the long term. This would not only threaten the economic stability of individual companies, but also shake confidence in international trade agreements. Representatives of the automotive industry emphasize: "We have to find solutions together to counteract the negative effects of these trade conflicts before affecting the competitiveness of our industry in the long term."
Danger of a global trade war
The potential for a full -grown trade war is also worrying. In addition to the direct tariffs on imports from Mexico and Canada, Trump has also warned of further punitive tariffs for European goods. In particular, premium brands such as Mercedes and Porsche, which export a significant share of their vehicles to the USA, could be strongly hit. Such a conflict harbors the risk that the global supply chains will be destabilized sustainably. There is afraid that companies are even more localized as a result of such measures and prefer regional markets, which could lead to a fragmentation of global trade.
Strategic adjustments and long -term trends
In addition to the immediate economic effects, the focus also focuses on strategic adaptation of entire industry. The need to localize supply chains and focus on regional markets is interpreted by experts as a long -term trend. Companies are increasingly investing in modern production facilities in the USA and Europe to minimize the risks of international trade conflicts. At the same time, they are increasingly relying on digital technologies and flexible manufacturing processes in order to be able to react quickly to geopolitical changes. This change, which is accelerated by the current tariffs, could lead to a more resilient and innovative industry in the long term.
US President Trump's punitive tariffs can trigger a chain reaction that goes far beyond the original target market. The German automotive industry is not only faced with increasing production costs and the need for relocation, but also with profound strategic restructuring. In a globally networked economy, in which political decisions have direct economic effects, it remains the central challenge to act flexibly and future -oriented - for the benefit of industry and consumers.
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