US trade policy could create a new problem for the same Detroit automakers it aims to protect. Stellantis, Ford and General Motors fear that proposed changes to the USMCA trade agreement with Canada and Mexico could force them to reorganize deeply integrated North American supply chains, adding billions of dollars in annual costs on top of existing tariffs.
New USMCA rules could cost Stellantis, Ford and GM billions every year
The Trump administration has proposed requiring vehicles to contain at least 50% US-made content to qualify for more favorable tariff treatment. Washington also wants to raise the overall North American content requirement from the current 75% to 82%. Current rules treat the United States, Mexico and Canada as a regional manufacturing system rather than reserving a specific percentage of each vehicle’s value for US production.
That change could prove expensive for companies that have spent decades building supply chains across all three countries. Estimates from two automakers suggest the proposed rules could add at least $2 billion in annual costs to each Detroit manufacturer. Shifting sourcing back to the United States would require new suppliers, manufacturing investments and changes to existing production programs.
Those potential costs would arrive while tariffs already weigh heavily on earnings. GM currently expects $2.5 billion to $3.5 billion in gross tariff costs during 2026, while Ford estimates its net tariff impact at roughly $1 billion.
Ford has already started adjusting its manufacturing strategy. The company announced that it will increase Lincoln production in the United States beginning in 2030 and gradually end imports of US-market Lincoln vehicles from China. The long timeline illustrates how difficult it can be to reorganize vehicle production around different factories, suppliers and components.
Stellantis, Ford and GM have also raised concerns about their competitive position against overseas manufacturers. Their industry group argues that vehicles imported from Japan, South Korea and Europe can face a flat 15% tariff, while Detroit automakers must navigate more complicated rules and potentially higher costs when moving vehicles and parts across the US, Canada and Mexico.
The next phase of USMCA negotiations will determine whether North America continues operating largely as an integrated automotive manufacturing region or whether the rules push substantially more production into the United States. The difference could cost Detroit’s three major automakers several billion dollars every year while reshaping where they build vehicles and source their components.