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From raw materials to component parts, and even vehicle assembly, the changing face of the global automotive landscape is affecting the way U.S. buyers have been looking at their next vehicle purchase. It also has caused several OE manufacturers to revisit their own policies and marketing initiatives. Localization of manufacturing for U.S.-market vehicles has resulted in many European manufacturers putting down roots in areas more familar with NASCAR rather than the Nurburgring. 

During the so-called “Malaise Era” (1973-1984), US-based vehicle quality declined significantly, giving Asian and European manufacturers a golden opportunity to capture the hearts and minds of many an American buyer. Initially, the Asian manufacturers cornered the economy market, with their inexpensive, reliable and fuel-efficient compact cars. European marques like BMW, Mercedes, Audi, Porsche, and even Volkswagen, became symbols of elevated status while maintaining reputations for precision engineering, impeccable quality and unmatched luxury.

Today, ever-changing economic policies have left some of these European manufacturers re-evaluating the parts and processes that allow them to continue offering their vehicles for sale in the U.S. Of the major European manufacturers, Jaguar Land Rover (JLR) is the only group that does not maintain an assembly plant on U.S. soil. Tariff announcements, coupled with an announced shift toward full electrification of the Jaguar lineup, have already hurt JLR’s profits in 2025, even before a cyber attack crippled assembly, parts distribution and dealership sales for five weeks this fall. The Germans have fared much better, with an established network of assembly plants throughout the southern U.S.

Volkswagen AG was the first of the Euro marques to build here, producing the Rabbit, Golf and Jetta during a 10-year tenure in Pennsylvania from 1978-’88. They decided to move south for their second attempt in 2008, choosing a location in Tennessee over options in Michigan and Alabama. Currently, Volkswagen AG builds only a few VW models in the U.S., including the Atlas, Atlas Cross Sport, and the all-electric ID4 at their present Chattanooga, TN, facility. The Scout nameplate, formerly associated with International Harvester, will soon be revived as an electric pickup and SUV platform when VW’s second domestic assembly plant opens outside of Columbia, SC, in 2027. Rumors of bringing future Audi and Porsche manufacturing to these plants have been swirling for most of the year. 

South Carolina also has been the unlikely source of many beloved BMW models like the 3-Series and the Z3/Z4 roadsters since opening in 1994, and currently produces the X-Series SUVs for both U.S. and global distribution. It boasts the largest volume of any BMW facility worldwide. In addition to BMW’s Spartanburg vehicle assembly, South Carolina is home to Mercedes-Benz, with its Sprinter and eSprinter platforms assembled in Charleston. Mercedes also operates assembly and manufacturing facilities in Alabama, producing the GLE and C-Class, in addition to the EQS platform and its batteries

BMW and Mercedes have been criticized in the past for advertising these vehicles as “Made in America,” when many of the components used to assemble these vehicles are sourced from global suppliers, and those models are also assembled in plants outside the U.S. This feels a bit unfair, given that the Big Three have a long history of producing vehicles beyond our own borders. We have already seen the introduction of Chinese-built Buick Envision and Lincoln Nautilus platforms, a host of Italian-built and designed Jeeps, and “American” pickups have regularly been manufactured in Mexico as well as Canada for decades. Volvo, an historically Swedish company with an assembly facility in South Carolina, is currently wholly owned by Geely, a Chinese holding company!

The globalization of our American automotive landscape, after 30 years of continuing growth and diversification, seems poised for a period of temporary stagnation as manufacturers, suppliers and buyers try to keep up with an ever-shifting marketplace. Uncertainty regarding the futures of ICE and BEV powertrains have led manufacturers as well as new vehicle buyers to pump the brakes a bit when it comes to making a commitment to future investments. In this period of unsettled economics and political turbulence, expect to see more companies choosing the relative safety of shorter supply chains and the localization of production for the diverse markets they serve.

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