Mercedes May Move Some US Production To China

Two weeks ago we reproted that BMW – the largest US auto exporter – is considering moving production for some of its SUVs out of the U.S. – the company employs 10,000 people at a plant in Spartanburg, S.C. – and to China as a result of new tariffs placed on the vehicles. Now it’s Mercedes’ turn.

On Thursday, Daimler said it was looking at ways to mitigate the impact of a trade war between China and the United States, a step which includes a review of whether to shift some U.S. production to Asia, according to Reuters.

Daimler’s profits have been hit since the start of the month as a result of tariffs on exports to China of the Mercedes-Benz GLE SUV which is built in Tuscaloosa, Alabama. Asked whether Daimler would consider manufacturing the Mercedes GLE at its factory in Beijing, Chief Executive Dieter Zetsche said, “Of course we look at when parameters change, and how one could react to this, and whether we can set ourselves up in a better way.

For now the company has not made a decision: “we are thinking about such matters, but so far we have not come to a decision.”

Zetsche added that recalibrating the production footprint was costly and time consuming since it also required reconfiguring the supplier network, but the longer the trade war persists and the more money Daimler loses on export tariffs, the more likely such a move will be.

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Author: Tyler Durden