Auto News Writer for Effizzie Magazine
Deji Osas
Volkswagen Group, the second-largest automaker in the world, has made the surprising decision to halt all car imports to the US following the imposition of a 25% tariff on imported vehicles.
The company confirmed it is in a critical holding pattern due to President Donald Trump’s tariff on foreign-made cars.
A spokesperson for Volkswagen Group voiced concerns about the new tariff, warning of its potential negative impact on global economies, including the US. The spokesperson stated, “We align with the view of most experts that US tariffs, along with any counter-tariffs, will harm growth and prosperity in the US and globally. The entire automotive industry, international supply chains, businesses, and consumers will bear the adverse effects.”
Volkswagen has been producing cars in the US since 1978, with models like the Atlas SUV and ID.4 electric crossover built in its Tennessee plant. However, other models, including the Jetta sedan and Tiguan SUV, are made in Mexico, and the Golf is imported from Germany. Audi, part of the Volkswagen Group, also imports all its vehicles.
As a result, the new import tariff will drive up the prices of many Volkswagen models in the US. To explain the price increases, Volkswagen stated that all models sold in the US will include an “import fee,” which will appear alongside other typical charges such as road tax and optional features.
According to a memo to car dealerships, Volkswagen Group will freeze all shipments to the US until further notice, with the company’s stock expected to last just under three months.
Executives at Volkswagen are reportedly working to persuade the Trump Administration to revise the tariff terms.
