Hyundai shifting some production to Alabama to combat auto tariffs

Hyundai is shifting some production of its Tucson SUVs to its Montgomery plant in response to the Trump Administration’s automotive tariffs.

Financial Post is reporting the move has already begun and affects Tucsons to be sold in the U.S. market.

Previously, they had been made at the South Korean automaker’s affiliate Kia Corp.’s Mexico plant.

It is also moving production of Canada-bound cars, which had been made in the U.S., to the Mexico plant.

CFO Lee Seung Jo, head of the planning and finance division, talked about the moves during a conference call.

The company also plans to offset some production hiccups through its new Georgia plant, which is gradually increasing production capacity.

“We expect a challenging business outlook to continue due to intensifying trade wars and other various unpredictable macroeconomic factors,” Hyundai said in a statement, according to the New York Post.

Last month Hyundai created a tariff task force to minimize the impact of the tariffs through local sourcing of auto parts in the U.S.

Earlier in April, Hyundai announced it is ending its free scheduled maintenance visits for new car buyers as a tariff measure. The company also announced that it doesn’t have any immediate plans to raise prices in response to the tariffs, and last month revealed plans to invest $21 billion on its U.S. manufacturing operations.