Foreign car makers are considering moving more manufacturing to North America from their overseas plants following the recent U.S. trade deal with Canada and Mexico.
The Wall Street Journal reports that within days of the U.S. and Canada reaching a pact to replace the roughly 25-year-old North American Free Trade Agreement, executives at several foreign car makers said they are considering changes to their supply chains that would shift more auto-parts manufacturing work to the U.S., Canada and Mexico.
“We will allocate more U.S. production for the U.S. market,” BMW CEO Harald Krüger told reporters at the Paris Motor Show this week. He added that the German car maker already sources many parts in the region but the new trade pact will accelerate a shift in investment.
Carlos Ghosn, head of the Renault-Nissan-Mitsubishi alliance, says the new North American trade pact would spur the car-making group to invest more in both the U.S. and Mexico, but didn’t provide details.
Honda and VW say in separate statements that they are still analyzing the potential impact of the deal on their local operations.
The impact on foreign automakers’ North American operations from the new United States-Mexico-Canada Agreement, which still has to be approved by Congress, remains unclear.
