Trump tariffs yield partial US auto gains, supplier investment slows

October 4, 2026 at 06:57 AM2 min

This digest was compiled by AI from multiple sources — links to the originals are below.

US auto manufacturing has seen incremental gains under President Donald Trump's tariffs, with Toyota announcing a $3.6 billion San Antonio plant expansion. However, supplier investment has plunged from over $8 billion in Q1 2025 to around $600 million in the following two quarters, according to the Center for Automotive Research. Auto employment in September stood at just under 1.8 million workers, up nearly 1 percent from January 2025 but still more than 2 percent below the July 2024 peak.

Key Facts

Toyota announced a $3.6 billion expansion of its San Antonio plant to move Tacoma pickup production from Mexico.
Supplier investment plunged from more than $8 billion in Q1 2025 to around $600 million in the two subsequent quarters, according to CAR data.
US auto employment reached just under 1.8 million workers in September 2026, nearly 1 percent above January 2025 but over 2 percent below the July 2024 peak.
A top Honda executive said in August the company was near full capacity in North America and might pivot on a new plant if USMCA uncertainty persists.

Tariff Impact on Automakers

General Motors, Toyota, Ford and other carmakers have announced plans to expand US plants or shift production from overseas since Trump returned to the White House. Toyota's $3.6 billion San Antonio expansion moves Tacoma pickup production from Mexico to Texas. Stephanie Brinley, an automotive analyst at Mobility Global, called the tariff lift to the US auto industry "a partial win." Auto industry experts view the unsettled nature of Trump's trade measures as a hindrance to bigger wins.

Supplier Investment Slowdown

Investment by suppliers plunged from more than $8 billion in the first quarter of 2025 to around $600 million in the two subsequent quarters before recovering somewhat, according to CAR data. Tyler Harp, an industry economist at the Center for Automotive Research, said there has been "a noticeable slowdown" in supplier investment due to policy uncertainty, including on tariffs. Harp added that suppliers are more exposed to tariffs and not in a position to absorb them as well as automakers. The US auto supplier sector employs some 930,000 people.

Employment and USMCA Uncertainty

US auto employment has been on an upswing for most of 2026 after falling for much of 2025. In September, the sector had just under 1.8 million workers, according to the US Bureau of Labor Statistics. That is almost one percent more than the level in January 2025 when Trump took office, but more than two percent below the peak level from the last decade, in July 2024 when Joe Biden was president. A top Honda executive said in August the company was operating near full capacity at its North American facilities and wanted to build a new plant, but might pivot if the fog around USMCA persists.