Volkswagen revs up supply chain localization on USMCA, tariff risk reduction

Cons. Discr. - Autos 1006 Mexico 765 Tariffs 1696 Trade Deals 932 U.S. 4830 USMCA 439

Volkswagen is developing expanded engine manufacturing at Guanajuato, Mexico from 2021 to support the production of the Taos CUV. The passage of USMCA and reduced risk of widespread, unpredictable tariffs under a Biden administration allows the firm to make long-term supply chain plans. VW has been steadily onshoring engine manufacturing to North America with imports of engines and parts to Mexico down by 22.1% and 29.7% year over year respectively in 2019. In 2020 the pandemic has meant imports of engines fell by 49.3% year over year in Q3’20. Total Mexican imports of engines and parts ...

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