Volkswagen models such as Jetta, Tiguan, and Taos, produced for the US market, could be impacted by the tariffs. Credit: MDart10/Shutterstock.

Volkswagen has expressed concern over the “harmful economic impact” of potential tariffs proposed by US President Donald Trump on imports from Mexico, reported Reuters.

The German auto giant, which is already facing high costs and competition from cheap Chinese imports, expressed concern over uncertainty after Trump’s threat to impose a 25% duty on goods from Mexico.

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Trump stated that while no firm decision has been made, the tariffs could take effect on 1 February 2025.

In an emailed statement to Reuters, Volkswagen said: “The Volkswagen Group is concerned about the harmful economic impact that proposed tariffs by the US administration will have on American consumers and the international automotive industry.

“We value collaboration and open dialogue. The Volkswagen Group looks forward to continuing its longstanding and constructive partnership with the US administration.”

Currently, Volkswagen operates a factory in Puebla, Mexico which reported production of nearly 350,000 cars in 2023.

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Volkswagen’s models such as the Tiguan, Jetta, and Taos, that are primarily destined for the US market, could be affected by the Trump’s proposed tariffs.

Amidst these challenges, Volkswagen highlighted its commitment to the US market by announcing investments exceeding $10bn.

This investment is roughly divided between its Chattanooga plant in Tennessee, US and a joint venture with Rivian.

German car sector’s lobby group German Automobile Association (VDA) president Hildegard Mueller was quoted by the news agency as saying: “In the discussion with the new US president, it is also clear that economic strength is the best response to the latest challenges.”

Sources familiar with the matter said that Volkswagen has been actively engaging with the Trump administration to discuss the implications of the proposed tariffs.

Last week, Reuters reported that Chinese investors and officials were considering the acquisition of German automotive factories facing closure, with a particular interest in those owned by Volkswagen.