Audi's U.S. plant plans stall as Volkswagen waits for tariff relief
Volkswagen's plans to build a new Audi plant in the U.S. remain on hold due to high auto tariffs. CEO Oliver Blume has warned that the project cannot move forward without changes to the current duties. The company has paused investments while awaiting a decision from U.S. officials.
The proposed Audi plant, initially discussed for locations including Tennessee, faces financial hurdles under existing tariffs. Volkswagen owns land in South Carolina but has not confirmed a final site. Other states have also expressed interest in hosting the facility.
Negotiations stalled in late 2025 after the company deemed the project uneconomical under the current tariff structure. Blume has stated that no decision on the plant's location will be made until the U.S. adjusts its auto import duties. Previous discussions with former President Trump and Commerce Secretary Lutnick failed to secure concessions.
Meanwhile, Volkswagen is under pressure to expand its U.S. presence while cutting costs. As part of this strategy, the company is considering selling its heavy-duty engine division, Everllence. Multiple buyers, including private equity firm Blackstone, have shown interest in the unit.
The future of the Audi plant hinges on U.S. tariff policy. Investors are watching for government action, as any changes would directly impact Volkswagen's investment plans. Until then, the project remains in limbo, and the company continues to explore divestments to streamline operations.
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