General Motors CEO Mary Barra explained that the company was already making moves to operate more in the United States and separate itself from China long before facing tariffs.
The auto industry faces 25% tariffs on foreign automobiles. While some companies like Tesla try to fight the tariff, other companies are simply falling into compliance. Barra explained on Fox Business’s Mornings with Maria on Thursday that her company started complying years ago.
“We added the capacity at our Fort Wayne assembly plant in Indiana that builds full-size trucks that have added workforce to be able to build 50,000 more trucks in this country yet this year. That’s on an annualized basis. We are continuing. We have already built two battery cell plants in this country with a joint venture partner, we’re in the process of building a third,” Barra said. “We recognized we needed to have supply chain resiliency, and over the last five years, we’ve increased the number of parts going into our vehicles assembled in the U.S. by 27%.”
As long as auto makers comply with the U.S., Mexico, and Canada Trade agreement, they can avoid tariffs. The trade agreement, which started on July 1, 2020, is next up for review in July 2026. Barra admitted that some car parts aren’t available in the U.S., Mexico, or Canada.
“Our reliance on China for parts, in some cases, they’re the only place where the parts are available, that’s now down to less than 3%,” Barra said.
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Other automakers have opted to change their strategies to avoid the tariffs after the tariffs were announced. Honda plans to manufacture its Civic Hybrid in the U.S. after the initial plan was to operate in Mexico. Hyundai‘s Georgia plant will increase production by 67% rather than produce more outside of the country.
While the foreign tariffs imposed on 86 countries are expected to be negotiated by respective dignitaries, President Donald Trump has promised that the auto tariffs will be permanent.