“Liberation Day” is upon us. That is what US President Donald Trump has titled his April 2nd tariff rollout, which is set to hit foreign automakers. The 25% tariff sticker is the White House’s response to being “ripped off” for far too long by trade partners like Europe and “...will continue to spur growth that you’ve never seen before," as Trump puts it. 

While we wait for this promised growth to come to fruition, automaker stocks, both in the US and abroad, have already seen sharp declines since the announcement last Thursday. This comes as no surprise. Automakers from abroad can’t make factories in the U.S. in less than a week. It requires a whole rewiring of transatlantic trade flows. As the big day looms, tariffs will shock global supply chains and require automakers in Europe to adapt to this new market reality.

European automakers are actively exploring strategies to mitigate the financial impact and maintain their competitiveness in the U.S. market. During this process, production relocation plans are seriously being considered. However, reacting quickly and making the right decisions are two different things. 

How European brands will respond depends on the numbers that back their decision-making. Geospatial data and location intelligence help guide these key decisions in reaction to drastic geopolitical changes.

The changing U.S. landscape for European automakers

The current Washington political regime is playing a different tune than the many previous administrations before it. Not since the inter-war periods of the 20th century have we seen an Oval Office with such a strong isolationist conviction on protecting domestic interests. 

As a result, European automakers are being dealt a harsh hand that requires rapid recalibration. Despite its substantial presence in the U.S., with over 11,000 employees and a manufacturing plant in Alabama, Mercedes Benz is going to face significant challenges due to the tariffs. The additional 25% will even impact local assembly lines, potentially costing $1.7 billion in 2025, hitting operating profits.

Similarly, BMW and Volkswagen will be reassessing production strategies. BMW, which exports its vehicles from Europe, Canada, and Mexico, and Volkswagen, which has limited U.S. production capacity, are looking into local production in response to the tariffs. But, such a change requires substantial investment and time. 

Ineos Automotive, which produces vehicles in France, is now considering manufacturing in the U.S.. The new tariff duties would put the company’s operations under strain, and force relocating production to remain relevant in the U.S. market. 

This goes beyond tariffs. It’s a new period of regionalism, economic nationalism, and fragmented regulation. The challenge lies in navigating the cost pressures and supply chain shakeup while continuing to innovate and provide vehicles to customers. 

We can evaluate the impact on the automotive industry as such:

Market shifts

Local production will be necessary to stay competitive and avoid the impact of tariffs. European automakers like Audi are already planning to expand their North American production, focusing on models for the U.S. market.

BMW and Mercedes are reevaluating what models to export and produce locally. Premium models may still be imported with a price hike, while high-volume models might follow Audi and shift production to the U.S.. 

The real risk of this market shift is the market share loss. Brands that can’t localize fast enough may lose their U.S. market share to competitors with established domestic production.

Consumer trends

Tariffs will raise the price of import vehicles and, later, vehicle parts, making European cars less desirable for the mass-market. Luxury consumers may absorb the higher costs, but en masse, buyers will look for low-cost alternatives. 

The idea behind Trump’s protectionist ideology is to promote a made-in-America perception. He wants cars to be built in the U.S. as this will fuel nationalistic sentiment and popularity for local products. Customer loyalty will be tested. 

The economics and supply chain rumble

Supply chain and finance departments will have their work cut out for them. Tariffs add costs and will force supply chain restructuring—including moving or duplicating operations in the U.S.—and this will squeeze margins firmly. 

When the May tariffs take effect (liberation day part 2?), the transatlantic supply chain will be a parts sourcing headache, especially for manufacturers relying on just-in-time logistics. 

On top of all that, any capital that could have gone to R&D and EV innovation will need to make way for a redirection toward tariff compliance and factory builds. Not ideal for European brands that are also tasked with meeting EU Green Deal targets.

Competition pressures

Domestic manufacturers like GM and Ford may gain a price advantage from these new measures, including federal incentives for local production. Even Tesla might benefit from liberation day despite its period of turbulence. 

However, multi-national companies like Stellantis with a global production footprint have fallen right into the crosshairs of these duties. Stellantis owns multiple brands under its name, including Peugeot, Fiat, and Alfa Romeo. While its American brands like Jeep and Dodge may avoid the tariffs, its European-brand imports and parts are not immune. On top of that, even the pure American-based brands will have to rethink their parts supply chain as the incoming May tariffs on parts will directly impact the price of production and drive up costs (for the consumer as well).  

All this to say, what appears to be a U.S. “advantage” is more nuanced and brand-dependent.

Where does geospatial data step in?

Geospatial data gives a forward-looking lens to strategically shift into the U.S. market with confidence in site selection, logistics, and customer alignment. 

Factory relocation

With European brands considering factory relocation, strategic site selection will be essential for the process. The combination of POIs, footfall, and mobility data will help identify optimal manufacturing sites. It will give automakers insight into the density and proximity of sites about auto part suppliers, logistics hubs, transportation, and ports. That ensures any relocation planning is executed with full confidence in knowing that essential supply chain channels are within realistic geographical reach. 

Retail and distribution

Brands that are considering U.S. expansion and making U.S.-only models can use POI data to understand competitor distribution and strategize their market presence. With POIs and mobility data, they can understand footfall patterns at competitor sites to gauge customer popularity. It will also allow them to evaluate the EV charging infrastructure and service centers to ensure they are targeting viable markets. In short, they gain a complete understanding of the retail landscape and insight into any given area.  

Another element of the retail strategy is consumer catchments. For retail or showroom locations, footfall helps pinpoint where target consumers already frequent (malls, commercial centers), which is especially useful for premium European brands wanting to adapt to the new market. 

Echo Analytics: A key partner

Echo Analytics transforms geospatial data into actionable insights, simplifying decision-making through location intelligence. 

With cutting-edge data processing, we deliver geospatial data and insights that empower organizations to navigate the complexities of the physical world with clarity and precision. Powered by ML and AI, our data processing allows us to deliver comprehensive datasets that are structured, aggregated, and contextualized to meet business needs. 

Why is that valuable for automakers?

To make strategic decisions, such as factory relocation and expanding retail presence, you need data to understand the market. That includes geographic data. The time and investment to collect, clean, and use viable data to make these decisions are often underestimated. High-quality data requires a lot of heavy lifting and work to derive any valuable insights from it. When you don’t have the time to do it, that’s where we step in. The hard part isn’t getting geospatial data—it’s making it usable, and that’s what we do best. 

Our process guarantees high-quality location data, so when markets, politics, and regulations shift, you have access to actionable intelligence and can adapt with it.

POI, mobility, and footfall data provided by Echo Analytics lets automakers examine foot traffic trends, business activities, a shifting commercial landscape, and evolving market conditions. By analyzing the relationship between POI data and mobility patterns, automakers can identify high-potential manufacturing locations and make confident expansion strategies.

Benefits of being driven by location data

Market shifts, consumer trends, supply chain woes, and competition pressure. These are the challenges faced by European automakers as of April 2nd. 

For market shifts, location data will allow European automakers to strategically choose the ideal site for factory relocation should that decision be necessary. 

Consumer trends and the test of customer loyalty can be mitigated through understanding the retail landscape and competitors to reach your target market effectively. Of course, this is assuming production is relocated to the U.S. 

With the right location choices, cost margins may be relieved of some of that squeeze given by the tariffs and help with supply chain operational efficiency. 

And competition pressure. The car market is a global network, even legacy brands will be impacted by the tariffs one way or another. While some European car manufacturers might be elbowed out by domestic competition, those that are looking to move in can still challenge U.S. brands with location-based intelligence. 

Conclusion

Since taking office for his second term, President Trump has brought drastic changes to the international realm of relations. And we’re only in April. Despite the gut-punch tariffs that will hit Europe’s automakers, proactive decision-making will be necessary to mitigate short and long-term impacts. With actionable geospatial intelligence, the question of what to do next can be answered.