President Trump has threatened import tariffs on automobiles seemingly forever, ranging from 25 percent to 300 percent depending on how he’s feeling that day, but the administration seems poised to launch a new raft of import tariffs on February 1. The incoming punitive tariffs are aimed at vehicles built in Canada, Mexico and the EU, which leaves Audi and Porsche particularly exposed, as neither automaker has ever built a car inside the United States. In order to avoid being hit with these difficult tariffs, parent company Volkswagen Auto Group is considering expanding its Chattanooga, Tenn. facility to produce some American Made Porsches and Audis as well, according to reports from Germany’s Handelsblatt newspaper.
Both Porsche and Audi build the majority of their cars in Germany, though the Cayenne is built in Slovakia and Audi’s Q5 comes from Mexico. Any changes to the company’s production plan would take years to implement, possibly not even completing the new production lines by the end of President Trump’s term in 2029. The Chattanooga facility currently produces Volkswagen’s ID 4 electric SUV, as well as the large gasoline-powered Atlas and Atlas Cross Sport. Any new vehicles added to the production schedule, particularly Porsches, would require adding significant investment to the facility.
There isn’t any word yet as to which Audi or Porsche models could be moved to Chattanooga Assembly, but I have a few ideas. The ID 4 is built on Volkswagen’s MEB platform, which also underpins the electric Audi Q4 E-Tron and Q5 E-Tron. The Atlas, meanwhile, uses VW’s MQB Evo platform, which is also used in Audi’s A3. Those would be relatively easy wins for Audi, but any Porsches built there would require a pretty significant retooling. My money is on Porsche’s breadwinning volume seller crossover, the Macan. If Porsche buyers were asked to pay an additional 25 percent import tax for something like a 911 GT3, they probably wouldn’t rescind their order form, but a Macan buyer is slightly more cost conscious.
If Volkswagen were to add an MLB platform production line to its Chattanooga facility for the gasoline-powered Macan, this could also open up the possibility of building Audi Q5/Q7, Porsche Cayenne, and possibly even the Lamborghini Urus in Tennessee.
It is important to remember that a tariff is an import tax paid by the importer and passed along to the end consumer. If you thought your $89,000 Porsche Macan GTS was already quite expensive, the proposed 25 percent tariff would see its price rise to around $111,250 overnight.
