Volkswagen is reportedly close to securing a tariff deal with the US as the company continues to navigate losses caused by Donald Trump’s trade tariffs. CEO Oliver Blume said the 27.5% tariffs on European cars and parts, announced in April, have already cost the group “several billions,” and that even a reduction to 15% would remain a burden.
Volkswagen Promises Investments to Secure Lower Tariffs
Volkswagen, which owns Audi, Seat, and Porsche, has pledged “massive” US investments as part of efforts to negotiate a lower tariff, with potential plans to localise Audi production and expand exports from American plants. Blume noted that Porsche is particularly affected by a “sandwich” of tariffs and weak demand in China, as nearly all US-bound Porsche models are manufactured in Germany.
EV Ambitions Highlighted at Munich Motor Show
At the Munich motor show, Volkswagen unveiled a concept for a small, affordable electric car aimed at capturing a fifth of Europe’s compact EV market. Rival BMW is preparing a Chinese-made iX3 SUV with localised software for 2026.
Global Car Industry Feels Impact of Trade Disputes
Trump’s trade policies have caused disruption across the global car industry, with Lotus announcing 550 job cuts in the UK and Jaguar Land Rover cutting up to 500 management roles amid declining sales and broader market uncertainty.
