World's second largest automaker makes dramatic move as it stops all US car imports

By BEN SHIMKUS, CONSUMER REPORTER FOR DAILYMAIL.COM 18:51 07 Apr 2025, updated 20:17 08 Apr 2025

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Volkswagen is holding cars at US ports amid tariff turmoil.

Audi, the luxury arm of the world's second largest global automaker, has confirmed it's in a high-stakes holding pattern triggered by President Donald Trump's 25 percent tariff on imported vehicles.

The affected cars arrived in the US the same day Trump announced the sweeping levies. Now, they sit idle as VW considers its next move.

Executives are thought to be hoping for either a presidential U-turn or a chance to negotiate a lower rate.

It's the latest shot across the bow from VW. The company said it will display new 'import fee.'

The fee will appear alongside standard charges like tax and extras for optional features like heated seats or panoramic sunroofs.

VW's decision to hold shipments underscores the ripple effect hitting the global auto market. But Audi stands directly in the crosshairs of Trump's tariffs.

The luxury brand's top seller, the Q5 SUV, has a final assembly plant in Mexico and nearly every other car in the luxury brand's lineup ships from Europe, making its entire lineup tariff-eligible.

In a statement to DailyMail.com, the company spoke out against the tariffs and said it hoped Trump would step up to the negotiating table to rid the tax.

A Volkswagen spokesperson said consumers won't see an immediate impact. The company currently has about 37,000 vehicles in US inventory, enough to keep dealerships stocked for roughly two months.

'We share the assessment of most experts that US tariffs and any counter-tariffs will have negative consequences for growth and prosperity in the US and other economic areas,' a VW spokesperson told DailyMail.com.

'The entire automotive industry, global supply chains and companies as well as customers will have to bear the negative consequences.'

President Trump has long held that tariffs would motivate companies to invest in American manufacturing. But VW said the taxes threaten its US-based business model.

The spokesperson pointed out that VW invested more than $14 billion in US manufacturing plants and employs thousands of factoryworkers. The company has one gigantic factory in Chattanooga, Tennessee, where it produced the mid-size Atlas and Atlas Cross Sport SUVs and the electric ID. 4.

Despite the US factory, VW remains is one of the most exposed automakers in the US because it produces a majority of its US-sold cars in Germany and Mexico.

'We communicate to our dealer body about all aspects of the business, and we want to be very transparent about navigating through this time of uncertainty,' Volkswagen sources said.

'The messaging can change daily, based on circumstances. We have our dealers and customers best interest at heart, and once we have quantified the impact on the business we will share our strategy with our dealers.'

Daily Mail readers seemed non-plussed about the car company's sticker warning.

'Do as you please,' one commenter wrote in response to the German brand.

'No one I know with one plans on buying another one.'

But VW just recorded 15 percent growth in sales in the US in 2024, reaching over 4 percent of the US automotive marketshare.

Manufacturers are scrambling to calculate how deeply the duties will cut into their bottom lines, dealer inventories, and long-term production plans.

Last week, Stellantis — the maker of Jeep, Dodge, Ram, and Chrysler — announced it would furlough 900 employees and pause production in multiple factories as it worked through its tariff response.

Ford, which had a higher-than-average build-up of vehicles on its lot, said it was offering employee discounts to shoppers. GM is ramping up US-based production of its high-cost pickups.

Toyota said it would pay for new parts distribution systems in the US but hasn't commented on pricing changes. Mercedes-Benz said it wouldn't change vehicle prices in April.

Land Rover is also pausing shipments to the US.

Meanwhile, President Trump has consistently railed against tariff policies laid out by other countries.

But as global government leaders call the President to urge changes to the tax policy, they are facing a difference in reality.

'They charge us 39 percent, we're going to charge 20 percent,' President Trump said about European countries when launching his reciprocal tariff policy.

'So we're charging them essentially half.'

Most countries don't agree on Trump's numbers.

The World Trade Organisation estimates the overall tariff rate imposed on US products from the EU is slightly higher at 4.8 percent.

The block reported around $3 billion in tariff revenue from US goods in 2023. Meanwhile, America recorded $7 billion.

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