U.S. Mega-Automaker Outwits Tariffs With $4B Mexico-to-US Manufacturing Shift

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America’s best-selling carmaker is putting US factories back in the spotlight.

General Motors announced plans to invest $4 billion in American manufacturing capacity that will help shift vehicle production from Mexico to the United States.

The company said late Tuesday that the investment will be made over the next two years and is for its gas and electric vehicles.

CEO Mary Barra said in a statement on Tuesday that GM is committed to making two million vehicles annually in the US and supporting American jobs.

Last year, GM built 889,072 cars in Mexican factories, including the gas and electric Chevy Equinox and Blazer.

Soon, freshly-built gas-powered Chevrolet Blazer and Chevrolet Equinox models will roll out of American plants. Both are expected to come state-side starting in 2027.

The Blazer will be produced at GM’s Spring Hill, Tennessee plant, while the Equinox will be made at its Kansas City, Kansas facility.

GM will also begin making gas-powered full-size SUVs and light duty pickup trucks at its Orion Township, Michigan plant.

The move is a bit of an about-face: the company was
exclusively producing high-rolling EVs from the plant
, including the GMC Hummer, Cadillac Lyriq, and the Chevy Silverado EV.

It’s the second recent rejigging for GM’s EV plants in a month. The company recently announced plans to invest over $800 million to build new V-8 engines in a Buffalo, New York plant that was building batteries.

Electric vehicles will remain a major focus for GM, which
just reported a record sales month for its Chevy EVs
.

But GM’s manufacturing shift is the automaker’s latest move to navigate President Donald Trump’s automotive tariffs.

In April, the President signed an exacutive order that partially relaxed his previously-set 25 percent import levies on all cars and their parts.

But, despite the relaxed rules, the tariffs loomed heavily over automakers that chose not to bring manufacturing back to the US.

Barra recently warned that the company expected a $4 to $5 billion line item to pay for the tariffs this year alone.

She didn’t say if the automaker would pass those costs on to consumers.

However, independent analysts say the tariffs will raise prices, reduce sales and
make US production less competitive worldwide
.

Moving production back to the US still might not shield American consumers from higher prices, experts warned.

‘The challenge for GM will be the higher labor costs,’ David Whiston, an automotive analyst at Morningstar, told . ‘The higher costs might need to be passed down to dealers and consumers.’

Still Whiston said the company will likely remain profitable this year, despite the major investments and tariff costs.

The company agrees. But it recently slashed its earnings forecast because of President Trump’s policies.

It could also force other major carmakers — namely Stellantis — to bring more manufacturing capacity back to the US.

The bigger intrigue, Whiston said, will be the impact on Korean and Japanese
automakers like Toyota
, Honda,
Nissan
, Hyundai, and Kia.

‘If their governments can’t get a carveout for autos, then they have to decide between two difficult options,’ he said.

‘Do they eat tariffs for a few years and hope they go away once Trump leaves office, or do they take the expensive and more permanent route of adding plants?’

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