Volkswagen Eyes US Factory to Ease Trade Tariffs

A car factory in the USA in exchange for more favorable trade tariffs. This is what Europe's largest car manufacturer, German Volkswagen (VW), hopes will tempt President Donald Trump, reports Reuters.

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Volkswagen Eyes US Factory to Ease Trade Tariffs
Photo: Michael Kappeler/AP/TT

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We have a very attractive investment package that we will launch there, says CEO Oliver Blume to investors in connection with the presentation of Volkswagen's interim report for the second quarter on Friday.

He adds that Volkswagen has had "good discussions" with the American government.

Sweetening the bid

US President Donald Trump introduced 25-percent tariffs on cars and car parts in April. From the ongoing talks about a new trade agreement between the US and the EU, there are reports that these may be replaced by 15-percent tariffs.

While waiting for the talks to bear fruit, European car manufacturers are sweetening their own bids in the hope that Trump will lower their tariffs further.

For Volkswagen, it's about the possibility of opening a factory for the production of Audi cars in the US, according to Blume.

The German group, Europe's largest vehicle manufacturer, is lowering its forecast for 2025. Trump's tariffs are affecting the profit of the Audi and Porsche brands, both of which are large in the US.

Stock boost

Sales, previously estimated to grow by five percent, are now expected to be in line with last year.

VW reports an operating profit of 3.8 billion euros for the second quarter. Sales were 80.8 billion euros. Analysts had on average expected 3.9 and 82.2 billion, respectively.

Despite the cloud, the stock rose 4 percent in Friday's trading and is up over 14 percent so far this year.

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By TTEnglish edition by Sweden Herald, adapted for local and international readers

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