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Analysis by Julie Dautermann, Competitive Intelligence Analyst

�鶹��ý is here to help you through all aspects of rethinking your long-term business strategies, investments, partnerships, and technology. Contact the authors, your �鶹��ý relationship partner, or our Automotive Team to discuss and learn more.

Special Update — Trump Administration and Tariff Policies

• �鶹��ý & Lardner provided key takeaways from its recent Brainwaves event hosted in Detroit with the Society of Automotive Analysts, 100 Days and Beyond: Presidential Policy Shifts Impacting Automotive. Visit �鶹��ý & Lardner’s for more updates on policy analysis and the business implications of the Trump administration across a range of areas.
• �鶹��ý & Lardner partners Vanessa Miller, Ann Marie Uetz, and Nichola Ellis were featured ������,��, , and  for a roundtable discussion hosted in the firm’s Detroit office on the state of the automotive industry.
• �鶹��ý & Lardner partner Ann Marie Uetz assessed automotive supplier sentiment in the Crain’s Detroit article, “.”
• �鶹��ý & Lardner partner Gregory Husisian described business sentiment around the Trump administration’s fluctuating trade policy ������The Associated Press article, “.”Husisian also commented in on the tariffs’ economic ramifications on trade with Mexico.
• �鶹��ý & Lardner partners Alejandro Gómez-Strozzi and Fernando Camarena are featured in the ����𾱲���ٰ²��������article, “,” summarizing a recent �鶹��ý webinar on international trade and manufacturing in Mexico.
• �鶹��ý & Lardner partner Kathleen Wegrzyn addressed a number of FAQs regarding force majeure and price increases amid the current turbulent tariff landscape.
• Key tariff announcements include:
  • President Trump on March 17 that “in certain cases, both” 25% sector-specific tariffs as well as unspecified “reciprocal tariffs” could apply on U.S. imports beginning April 2. U.S. imports that have been traded duty-free under the United States-Mexico-Canada Agreement (USMCA) are — until April 2 — from the 25% tariffs on goods from Mexico and Canada that were announced on March 4.
  • Following the implementation of 25% tariffs on U.S. imports of steel and aluminum, Canada on March 13 on C$29.8 billion in U.S. imported goods. This follows 25% tariffs on C$30 billion of products Canada on March 4.
  • Mexican President Claudia Sheinbaum thus far with a plans to apply retaliatory tariffs on U.S. imports.
  • The European Union to reinstate 2018 and 2020 countermeasures on April 1 against a range of U.S. goods, with a more extensive retaliatory tariff package planned for later next month.��
  • China tariffs on U.S. goods including large-engine vehicles, as well as export and investment controls on over two dozen U.S. firms after the Trump administration 20% duties on Chinese imports.

Automotive Key Developments

• from S&P Global Mobility indicates the disruptive effects of 25% tariffs on all vehicle imports could potentially reduce North American production “by up to 20,000 units per day within a week.” S&P predicted a 50% probability for a tariff-related “extended disruption scenario” this year, during which certain high-profile vehicles “will slow or cease production.”
• MichAuto and described volatile tariff policies as “�������������Բ�” and “d����������ٲ��پ��Բ�” for the automotive industry and noted the ongoing uncertainty has already damaged OEMs’ and suppliers’ ability to make investment and product decisions.
• Statements from and the emphasized the potential for significant cost increases for automakers, suppliers, and consumers resulting from the 25% tariffs on U.S. imports of steel and aluminum. In addition, a recent survey by the vehicle suppliers association found 97% of respondents had concerns regarding increased financial distress among sub-tier suppliers due to the announced tariffs, and over 80% of surveyed suppliers are exposed to steel and aluminum derivative tariffs.
• Tariffs on steel and aluminum could raise costs up to on average, with the potential for greater impact on larger, such as the Ford F-150 pickup.��
• Relocating an assembly line between existing facilities can take up to , and an automaker would likely need up to to fully staff and significantly build out new U.S. manufacturing capacity.
• Ford is reported to be amassing inventories of USMCA-compliant parts to mitigate the effects of tariffs, and the automaker has told its suppliers to keep shipping under existing terms, according to an update from .
• assessed the exposure of certain EV brands to the impact of U.S. import tariffs.
• University of Michigan economists U.S. new light-vehicle sales will reach 16.3 million units in 2025, while noting the projections have “substantial uncertainty” due to trade policy volatility. The economists also expect steel and aluminum tariffs to “raise production costs in the automotive supply chain,” and the levies could reduce Michigan’s employment by approximately 2,300 jobs by 2026.
• Preliminary discussions concerning the renewal of the USMCA suggested a revised pact could result in higher tariffs for non-compliance, according to unidentified sources in .��
• The Environmental Protection Agency on March 12 31 deregulatory actions that include the reconsideration of the Biden administration’s emissions standards for light-duty, medium-duty and heavy-duty vehicles.

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• While tariffs in the U.S., Canada, and the EU may continue to impede sales by Chinese automakers in the near term, market share in emerging markets for Chinese brands that include BYD, Great Wall Motor, Chery Automobile,��and SAIC Motor Corp.
• Volkswagen to reduce production and headcount at its Chattanooga, Tennessee plant to support cost-cutting initiatives and in response to lower EV demand. Planned layoffs across VW Group have reached nearly 48,000 globally, a 30% headcount reduction at its Cariad software unit by the end of this year.
• Ford €4.4 billion ($4.8 billion) in its German operations, in an effort to boost sluggish sales in Europe.
• Nissan Ivan Espinosa, currently serving as Chief Planning Officer, to succeed CEO Makoto Uchida, effective April 1.

Market Trends and Regulatory

• U.S. new light-vehicle inventory reached 3 million units at the beginning of March, representing an 89-day supply industrywide, according to from Cox Automotive.
• The percentage of subprime auto borrowers at least 60 days past due on their loans , representing the highest level in over 30 years, according to data from Fitch Ratings. The share of auto loans in serious delinquency across all borrower types was in the fourth quarter of 2024, to 2.66% in Q4 2023 and 2.22% in Q4 2022.
• Kelley Blue Book that new-vehicle sales incentives were up 18.6% year-over-year in February 2025. The average incentive package last month reached 7.1% of average transaction price, or $3,392, compared to 6% of ATP in February 2024.
• U.S. Senate Republicans introduced the Preserving Choice in Vehicle Purchases Act () to “prevent the elimination of the sale of motor vehicles with internal combustion engines” by limiting the Environmental Protection Agency’s issuance of certain Clean Air Act waivers.
• GM has again with the Federal Deposit Insurance Corp. to establish an industrial bank, and this would enable the automaker to hold deposits and expand their financial offerings to consumers, dealerships, and employees. Stellantis and Ford have also recently submitted applications for banking licenses.
• U.S. House lawmakers included language in an to the Full-Year Continuing Appropriations and Extensions Act that “removes the ability for any House members to use an expedited process” to compel a vote for the remainder of this calendar year on whether to terminate the national emergency declaration utilized as the basis to pursue tariffs on imports from Canada and Mexico. The “continuing resolution” (CR) to fund the federal government through the rest of the fiscal year 2025 was by the president on March 15, 2025.

Autonomous Technologies and Vehicle Software

• Industry organizations, including the Alliance For Automotive Innovation, the Department of Transportation to establish a national framework to support the deployment of autonomous vehicles.
• NVIDIA will collaborate with and to advance next-generation vehicle technologies. NVIDIA has artificial intelligence technologies in the auto industry as a “trillion-dollar opportunity.”
• GM Barak Turovsky, formerly of Cisco and Google, as its first Chief Artificial Intelligence Officer.
• Ford tech veteran Mike Aragon will join the company as President, Integrated Services. The position is expected to support the automaker’s goals to boost revenue from software-enabled subscriptions and features.
• Autonomous trucking startup Bot Auto to begin its first driver-out commercial freight pilot program in Texas this year, on routes between Houston and San Antonio. Houston-based Bot Auto was founded in 2023 by former TuSimple CEO Xiaodi Hou.

Electric Vehicles and Low-Emissions Technology

• Over 50% of new EV purchases in the fourth quarter of 2024 were leases, and EVs accounted for nearly 20% of all new vehicle leases during the quarter, according to from Experian released this month.
• BYD to launch new charging technology on certain models in China next month that will enable 400 kilometers (249 miles) of range with five minutes of charge time, or roughly the same duration required to refuel comparable gas-powered models.
• Cadillac to begin production of the electric 2026 Cadillac Escalade IQL in mid-2025 at GM’s Factory Zero electric vehicle assembly plant in Detroit.
• Volkswagen recently its ID Every1 electric minicar concept, and the low-cost EV will be the brand’s first model to use software from the automaker’s joint venture with Rivian.��
• Isuzu $280 millionto establish a commercial EV plant in Piedmont, South Carolina.
• UAW members their first labor agreement at the Ultium Cells joint venture battery plant in Spring Hill, Tennessee.
• SK On Nissan with nearly 100 gigawatt-hours of batteries from 2028 to 2033, to support future EV models produced at the automaker’s Canton, Mississippi plant.
• Stellantis €38 million ($41 million) to produce EV engine parts at its Verrone transmissions plant in Italy.