Honda is scrapping plans to provide its subsequent Civic mannequin in Mexico and transferring manufacturing to Indiana to keep away from President Trump’s upcoming tariffs, based on a report.
The Japanese auto large had initially deliberate to fabricate the next-generation Civic in Guanajauto, Mexico, beginning in November 2027, sources accustomed to the matter instructed Reuters.
Now, Honda plans to fabricate the brand new Civic in Indiana, beginning in Could 2028 – churning out round 210,000 autos every year, a supply instructed the outlet.
Honda shares rose 1% on Monday morning.
The automaker declined to touch upon the report, however mentioned it has flexibility to “produce products in each region based on customer needs and market conditions.”
Honda is simply the most recent main firm to think about a pivot to US manufacturing after Trump revealed his plan to levy 25% tariffs on Mexico and Canada.
Rival automaker Stellantis reversed plans to shutter its Illinois facility in January after its chairman, John Elkann, met with Trump and promised to spice up US manufacturing jobs.
Volkswagen, in the meantime, is reportedly weighing US manufacturing websites for its Audi and Porsche manufacturers to keep away from the proposed taxes, based on a German information outlet.
A supply instructed Reuters that Honda was initially eyeing Mexico over Indiana or Canada due to its cheaper manufacturing prices.
The corporate at the moment sends about 80% of its Mexican output to the US – which is the world’s second-largest auto market, trailing China.
Massive automakers like Honda rely closely on US gross sales. The corporate bought almost 1.5 million automobiles and vehicles in the US final 12 months.
These gross sales included greater than 240,000 of its inexpensive Civics – representing a 21% rise from the 12 months earlier than, the corporate mentioned in January.
Shinji Aoyama, Honda’s chief working officer, had warned final 12 months that the carmaker must take into account transferring manufacturing to the US if Trump imposed tariffs on car imports.
At present, round 40% of the autos that Honda sells within the US are imported from Mexico and Canada.
Honda additionally exports about 60,000 automobiles made within the US to Mexico or Canada. If the neighboring international locations reply with retaliatory tariffs, the Japanese automaker may face much more price will increase.
Canadian Prime Minister Justin Trudeau had ordered 25% tariffs on the US in early February, however agreed to pause the plan for 30 days together with Trump’s personal tariff plans.
Mexican President Claudia Sheinbaum mentioned Monday throughout a press convention that her administration is ready to see if Trump will impose the tariffs on Tuesday, when the 30-day pause is about to finish.
In February, Sheinbaum had mentioned she deliberate to levy retaliatory tariffs on the US, although she has not supplied particulars on the scale and timing of the taxes.
Secretary of Commerce Howard Lutnick mentioned Sunday that the deliberate tariffs would transfer ahead on Tuesday.
With Put up wires
