Jaguar Land Rover has halted all car shipments to the United States for a duration of one month due to significant disruptions in global automakers’ supply chains. These disruptions have escalated as a result of U.S. President Donald Trump’s imposition of tariffs on vehicle imports. The British automaker announced this suspension as they consider a long-term strategy in response to the 25% tariffs affecting vehicles assembled outside the United States. These tariffs include partial exemptions for Mexico and Canada.
In an official statement, Jaguar Land Rover emphasized the importance of the U.S. market for its luxury brands and outlined ongoing efforts to adapt to the new trade conditions in collaboration with business partners. The company’s decision to pause shipments highlights the turmoil caused by the U.S. tariffs, which are affecting the global automotive industry that relies heavily on intricate supply chains supported by free trade agreements.
Following this, Stellantis, maker of Chrysler and Jeep, recently furloughed 900 workers in the United States after temporarily halting production in Mexico and Canada. Nissan, the Japanese automaker, is also reevaluating its supply chains as a response to these tariffs. Recently, Nissan decided to stop accepting new U.S. orders for two models from its Infiniti luxury line built in Mexico while choosing to maintain two shifts at its plant in Smyrna, Tennessee, contrary to its earlier plan to reduce to one shift to cut costs.
Nissan, according to informed sources, is considering moving some production of its Rogue SUV from its domestic facility in Kyushu to Smyrna. However, Nissan has not provided any official comments on the matter. The industry’s efforts to alter supply chains come after a severe drop in equity markets, with the S&P 500 index losing 10% over two days.
The tariffs could have massive repercussions for the automotive sector, especially if a 25% duty on a wide array of imported parts becomes effective on May 3, further expanding the levy on finished vehicles imposed earlier. UBS analysts estimate that the combined impact of both tariffs could cost Japanese carmakers approximately ¥3.6 trillion ($24.7 billion).
Nissan’s potential production shift away from Japan may carry political implications, given the increasing tensions faced by numerous small and medium-sized auto suppliers, whose profit margins are already being squeezed by rising wage costs. JLR’s shipment pause also raises concerns regarding the future stability of the British automotive industry since the company exports 31% of its annual 400,000 vehicle sales to North America.
Toyota, the world’s largest automobile manufacturer, has indicated to suppliers its intention to reduce manufacturing costs to mitigate potential consumer price increases stemming from the tariffs. President Trump highlighted Toyota in a speech announcing “reciprocal” tariffs, criticizing Japan as a major violator and referring to them as “worse than the foe” in trade matters. While many Japanese carmakers already operate factories in the U.S., there is apprehension about launching significant investment projects due to concerns over high costs and labor availability.
Although South Korea’s Hyundai announced a U.S. investment plan totaling $21 billion last month, this did not result in any exemptions or special considerations for Seoul.
