Volkswagen to construct $4bn Audi SUV manufacturing facility in US regardless of job cuts at residence | Volkswagen (VW)

Audi has mentioned it would spend $4bn (£3bn) to construct its first manufacturing facility within the US, as its father or mother firm, Volkswagen, struggles with the impression of steep tariffs imposed by Donald Trump.

The German model’s chief govt, Gernot Döllner, joined Trump on stage at a marketing campaign rally on Saturday night time to announce the manufacturing facility in Macon, Georgia, in an uncommon transfer by an enormous European model simply days earlier than the US midterm elections.

The Republican social gathering underneath Trump is making an attempt to retain management of each homes of Congress, however it is polling poorly because it struggles with higher fuel prices caused by Trump’s war on Iran, in addition to his commerce battle towards a few of the US’s greatest buying and selling companions.

Trump has lengthy tried to persuade voters that his tariffs are serving to to extend the variety of manufacturing jobs within the US, and has seized on any new manufacturing facility investments. However, US car and components employment has fallen since Trump took workplace final 12 months.

Audi, Volkswagen’s most necessary premium model, has suffered from Trump’s 15% tariffs on imports from the EU in addition to the president’s efforts to chop gross sales of battery electrical automobiles in favour of petrol vehicles.

It mentioned it goals to construct 200,000 SUVs on the new US manufacturing facility, creating 4,500 jobs. The manufacturing facility will construct the Q7, Q8 and Q9 SUVs, shifting some manufacturing from Bratislava in Slovakia.

Volkswagen has mentioned Trump’s tariffs price it as much as €5bn(£4.2bn)a 12 months, earlier than the impression of decrease gross sales. The German producer this month mentioned it was nonetheless fighting “continued excessive strain from import tariffs”. The carmaker was additionally pressured to shift some manufacturing of its most cost-effective vehicles, such because the Jetta saloon and Taos SUV, from Mexico to the US.

The new manufacturing facility might add to tensions in Germany, the place Volkswagen has began to cut as many as 100,000 jobs and close factories. It has blamed the job losses on intense competitors from Chinese carmakers, in addition to the tariffs and a necessity to take a position closely within the shift to EVs for financial hubs apart from the US.

Döllner mentioned he accepted the invitation to talk at Trump’s rally out of respect for the US.

“We are planning to deliver our ⁠greatest and most premium SUVs, and produce them right here in Macon, Georgia,” he mentioned on the occasion. “This is a long-term financial backing as a result of we consider within the American market.”

Volkswagen’s chief govt, Oliver Blume, instructed buyers in July that “US tariffs create a major burden and prohibit overseas commerce”.

However, the group has mentioned there’s nonetheless demand within the US for Audi’s giant petrol SUVs, and it’s planning its largest-ever SUV, the Q9, with the American market in thoughts. Large petrol-powered SUVs have performed a big role in global carbon emissions.