The automotive industry is directly affected by investment decisions that are being postponed and rising costs, while uncertainty about tariffs creates a complex landscape.
Paslin, a company that manufactures assembly lines for car manufacturers, is reconsidering the use of a recently opened plant in Mexico in light of tariff threats. In the United States, Ford Motors is looking to move engines from Canada to the country before potential tariffs come into effect.
Volkswagen, for its part, is facing the need to manufacture more automobiles in North America, particularly at its plant in Puebla, although the current situation has complicated its expansion plans in Tennessee and Mexico.
Joe Perkins, CEO of Paslin, mentioned that the current uncertainty has paralyzed clients' decision-making, leaving orders on hold and affecting the company's long-term planning. By reducing costs and employee hours, they are trying to weather the storm while awaiting an improvement in the outlook.
With operations in several countries, including China and the U.S., Paslin is considering reevaluating its production strategy in Mexico, especially after the imposition of tariffs. Companies like Volkswagen, owner of several automotive brands, are looking to adapt to the new era of tariffs and face the challenge of making decisions amid so much uncertainty.
At the executive level, it is expected that the clarification of Trump's trade policy will directly influence investment decisions for companies like Volkswagen, while the automotive and auto parts industries face a scenario of paralysis. Concerns over rising steel costs and negotiations with clients regarding potential price increases keep uncertainty in the sector.
In this context, investments and expansion plans for plants like Scout in South Carolina are under review, awaiting greater stability that would allow companies to plan long-term in a more predictable environment.
