by Stellantis has announced the relocation of part of its pickup truck production to the United States to avoid high tariffs imposed by the Trump administration. This decision was made shortly after the confirmation of the temporary closure of the company’s plant in Canadian Ontario.
During the latest conference with analysts, the company’s CFO Doug Ostermann stated that besides relocating production, the automaker plans to change component suppliers to increase the share of American parts in its vehicles.
Initially, Trump’s measures caused serious concern in the automotive industry, but the policy was later adjusted. According to the latest changes, manufacturers can receive tariff benefits depending on the percentage of parts content that meets USMCA requirements.
Reportedly, the benefit amount is 3.75% of the production cost in the first year and 2.5% in the second. According to Ostermann, currently Stellantis vehicles in the USA contain about 80% USMCA components. If this figure can be increased to 85%, the first-year benefits will cover the tariffs on the remaining 15% of parts.
“We are working on this very actively,” he noted. “Some suppliers with reserve capacity in the USA can adapt quickly, others will need more time.”
The company does not disclose how much pickup truck production in the USA might increase in the future.
Earlier this week, it became known that Stellantis will suspend operations at the Ontario plant from May 5th for a week. This facility produces the new Dodge Charger and Chrysler Pacifica. In April, the plant was already closed for two weeks to assess the impact of American tariffs.
Unifor, the union representing the plant’s workers, reports that the company has not provided explanations for the reasons behind the upcoming production halt.
