The simple answer to that question is maybe. So far, there have been a lot of reactions to the tariff situation by a whole lot of people, including the heads at numerous car companies. There has also been plenty of speculation and reports that are marginally accurate or representing speculation and rumors as absolute fact, which makes it very difficult to get a clear picture of what’s going on. One thing that is certain is there’s definitely some movement to invest money into American manufacturing of vehicles. Whether that’s directly related to the tariffs, however, is much more difficult to discern (although it often clearly isn’t). Let’s take a look at what some of the major brands have announced and done so far.
General Motors Investing Heavily in US Production
One of the biggest investors lately when it comes to putting money into auto manufacturing in the US is General Motors, which includes Buick, Cadillac, Chevrolet, and GMC. In June of this year, GM announced plans to invest $4 billion over the next two years in its manufacturing plants here in the US, including facilities that make gas and electric vehicles. Rather than build new plants, this money will go into expanding production capabilities at existing plants in Orion Township, Michigan; Kansas City, Kansas; and Spring Hill, Tennessee. This is in addition to an $888 million investment it announced for a plant in Buffalo, New York that will build their next-generation V8 engine.
It’s worth noting that this is in line with what was generally expected from GM already. Its spending for 2025 remains unchanged at $10 to $11 billion, with annual capital spending staying at about that same level through 2027. While it’s fantastic that GM is investing in manufacturing here in the US, it’s not likely that news from the last five months or so was the determining factor for all of these things. Instead, GM’s success has almost certainly guided this. The Fairfax Assembly plant in Kansas City, for example, is being retooled to be able to make the Equinox starting in mid-2027, which has become one of Chevy’s most popular models.
Ford Seems Uncertain What to Do
Ford is an interesting story when it comes to how different car companies are responding to the tariff situation. For one thing, Ford has invested $7 billion into a plant in Stanton, Tennessee, where it plans to build EVs like the Ford F-150 Lightning. Ford is reportedly on track to begin manufacturing batteries for EVs at this location this year. Production of actual vehicles at the Stanton plant isn’t expected until late 2027. More notably, Ford broke ground on this plant in 2022, so none of this is new or in response to tariffs. This perfectly illustrates the reality of moving manufacturing to the US. A new plant takes years to build and even more years to start building anything.
This is reflected by the words of Ford CEO Jim Farley, who mentioned “a lot of cost and a lot of chaos” when talking to investors in February about the tariff situation. His words echo what General Motors CFO Paul Jacobson said in a similar investor talk. “If [the tariffs] become permanent, then there’s a whole bunch of different things that you have to think about… Think about a world where we’re spending billions in capital, and then it ends. We can’t be whipsawing the business back and forth.” In other words, car companies don’t want to spend $7 billion on a plant only to have these tariffs change a month later.
Honda Rumors Swirling Wildly
One of the biggest stories going around is that Honda is shifting production of its Civic hybrid model from Mexico to its plant in Indiana. This would be a big shift since Honda is Japan’s second-largest car company after Toyota, and it had already announced it would be making their next-generation Civic at the plant in Mexico. Production for this car is planned to begin toward the end of 2027, likely making more than 200,000 cars per year. Sources have claimed that this will now shift to the US instead, starting in mid-2028.
It’s worth noting, however, that Honda has announced absolutely nothing about this, so everything reported is from unconfirmed sources. There’s a real chance that this will happen and Honda will shift production, but it just as easily might not. Since production wouldn’t start for another two years or so, it’s also possible that Honda is waiting to see how things play out and make a decision based on the big picture in the next year. This would also explain why there hasn’t been an official announcement. Only time will tell.
Rivian Moves Away From Georgia Plant
Although certainly not as big a deal in the auto industry as companies like GM and Honda, Rivian is a major player in the growing EV market and has found some early success. It’s one of the few startups that have already gotten a vehicle to market and started winning over drivers. In an effort to start producing more vehicles, Rivian has been working on a $5 billion manufacturing plant in Georgia. Rivian announced in March that it was putting construction of that facility on hold and instead would be expanding the manufacturing capacity of its other plant in Illinois to produce its R2 model starting in the first half of next year. This is part of an overall shift to reduce spending by Rivian, which is clearly having some issues and trying to save money. It also illustrates how expensive it is to grow manufacturing locations in the US.
Stellantis Reopening Plant in Illinois
One seemingly big win for the power of tariffs to push manufacturers back to the US has been the announcement that Stellantis will reopen a manufacturing facility in Belvidere, Illinois, and bring on 1,500 members of the United Auto Workers union. Word is that this factory is going to start building a midsize Ram truck, which could be a great addition to their lineup. It’s worth noting, however, that this has nothing to do with tariffs. Stellantis agreed to reopen the plant and hire 1,500 workers as part of a deal with the United Auto Workers to end a strike back in 2023.
Other Companies Investing in US Manufacturing
Beyond the brands we’ve looked at so far, there are a number of other companies considering shifting more manufacturing here to the US, especially foreign ones. BMW is considering expanding production at its plant in South Carolina, while Hyundai has invested heavily in its plant in Georgia to produce more EVs and hybrids. Nissan is considering shifting some production from Mexico to the US, while Volkswagen and Volvo have also talked about moving manufacturing efforts to the US. You’ll notice, however, that I’ve said “considering” and similarly vague language. No one has broken ground on new plants, so there is a lot of talk and uncertainty right now.
How Much Is Due to Tariffs?
Ultimately, this is a question that can’t be easily or clearly answered because the proverbial waters flowing around this situation are incredibly muddy. The one thing that’s clear is that any shifts in manufacturing would be incredibly costly. These plants and investments are calculated in the billions. As such, no major car company wants to commit to something with a massive investment to avoid tariffs when those tariffs could disappear as quickly as they arrived. Furthermore, the whole situation flies in the face of the United States-Mexico-Canada Agreement that President Trump negotiated in his first term, a major reason why so much manufacturing is in Mexico in the first place. We won’t know the full impact and how car companies will react for several years, but it’ll be interesting to see how things shake out.
