Ferrari Refuses to Relocate While Automotive Giants Brace for Tariff Impact

The global automotive industry is bracing for impact following U.S. President Donald Trump’s introduction of 25% tariffs on foreign auto imports. Framed as a strategy to shift production stateside and bolster American jobs, the move has already begun to ripple through international markets. Automakers are responding swiftly - raising prices, halting shipments, and rethinking manufacturing strategies - as they brace for the financial and logistical challenges ahead.

Volkswagen, for example, plans to add import fees to vehicles shipped to the U.S. and has paused all rail shipments from Mexico. “We communicate with our dealer body about all aspects of the business, and we want to be very transparent as we navigate this period of uncertainty,” a Volkswagen spokesperson told CNBC.  

Porsche intends to lean on its partnership with Volkswagen, which has U.S. manufacturing facilities, to help offset potential tariffs from the White House. With no local assembly, Porsche is particularly vulnerable in a trade dispute with the EU, despite the U.S. being its largest market. “My hope is there will be an agreement between Europe and the U.S. … I’m counting on a fair solution between the regions,” CEO Oliver Blume told CNBC. 

Mercedes-Benz Group AG is considering shifting production of another vehicle model to the U.S. to manage the impact of the new tariffs - the specific model hasn’t been disclosed. “We’re still assessing the impacts of these tariffs,” said production chief Jörg Burzer, adding that flexibility is crucial. 

BMW is looking to add shifts at its Spartanburg, South Carolina, plant - located in a free-trade zone and responsible for exporting about half its output - in a bid to increase production by up to 80,000 units amid efforts to ease trade tensions with the Trump administration. The company said it has around 30 days’ worth of U.S. inventory and plans to keep prices stable on most models through the end of May. 

Ferrari, meanwhile, previously said it will not move production to the U.S., maintaining that all vehicles will continue to be manufactured exclusively in Maranello, Italy. “We will sell cars in the U.S., but we will make cars in Maranello,” CEO Benedetto Vigna confirmed, adding that prices on some models could increase by up to $50,000. 

Trump’s 25% tariff on foreign auto imports introduces heightened uncertainty and potential volatility in the automotive sector. Global carmakers are being forced to adjust pricing, shift production, and navigate disrupted supply chains - moves that can temporarily impact earnings, margins, and investor confidence.

At the same time, U.S.-based manufacturers or companies with significant local production capacity, such as BMW’s Spartanburg plant or Volkswagen’s U.S. operations, could benefit in the medium term as they pivot to meet domestic demand with lower tariff exposure.

Conclusion

As global carmakers recalibrate in response to Trump’s aggressive trade moves, this moment presents both challenges and opportunities for investors. Companies with agile manufacturing strategies and strong U.S. footprints - like BMW and Volkswagen - may be well-positioned to weather the disruption and even gain market share. Meanwhile, brands with limited U.S. production, such as Ferrari and Porsche, could face steeper costs and margin pressure. Investors should keep a close eye on Q2 and Q3 earnings, where tariff-related impacts on pricing, sales volumes, and supply chain costs could begin to surface more clearly.

In times of uncertainty, adaptability becomes a competitive edge. As automakers announce production shifts, pricing strategies, and trade negotiations evolve, investors have a unique window to assess which companies are leading with foresight and flexibility. Watching for forward guidance, margin resilience, and updates on inventory management could be key. The road ahead may be turbulent, but for those who monitor the right signals, this could be a chance to invest in strength, not just survival.

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