Detroit Automakers Warn Proposed Trade Rules Could Add Billions in Costs

Detroit’s big three automakers are bracing for a new headache as U.S.-Mexico trade talks approach. Ford, GM, and Stellantis are reportedly preparing a lobbying push ahead of next month’s negotiations, worried that proposed changes to the North American trade deal could raise their costs significantly.

-made content to qualify for lower tariffs, along with a possible hike in the current 75 percent North American content threshold. Two automakers estimate these changes could add at least $2 billion in annual costs for each company, on top of existing tariff expenses. 5 billion in tariff-related gross costs this year, while Ford puts its net hit at roughly $1 billion.

S. production ignores the reality of global supply chains, where parts come from many countries. They also claim foreign rivals get a better deal, Japanese, South Korean, and European exporters face a flat 15 percent tariff, while domestic manufacturers juggle a messier mix of levies on vehicles, parts, steel, and aluminum.

Meanwhile. S. market from China to American factories, with CEO Jim Farley acknowledging the administration’s seriousness about reshoring. Still, the industry warns that a deal meant to boost North American production could end up making it less competitive.