First Jolt! Mercedes To Pull Out Entry Level Cars From US Markets Over Donald Trump's Tariffs?

Mercedes-Benz is understood to be considering pulling its entry-level luxury models from the US. market due to new auto tariffs imposed by former President Donald Trump , reported Bloomberg. 

Impact of New Auto Tariffs

The 25 percent tariffs, which will come into effect this week, could make bottom-end luxury models like the GLA SUV commercially unviable, according to sources familiar with the matter who spoke with Bloomberg.

In India, the price of Mercedes-Benz GLA, a 5-seater Compact SUV, ranges from Rs. 50.80 - 55.80 Lakh. It is available in 3 variants, with engine options ranging from 1332 to 1950 cc and a choice of 1 transmission: Automatic. GLA comes with 7 airbags. 
 

However, the newswire agency claimed that the German carmaker has not made a final decision and may realign its plans depending on how the tariffs are implemented.

Strategic Shifts to Top-end Vehicles

In order to curb losses, Mercedes may focus on selling top-end and more profitable models in the US. Other luxury automakers, such as Aston Martin and Ferrari, are already raising prices, while Volkswagen is considering more local production.

Notably, Mercedes has been increasingly focusing on premium models under CEO Ola Källenius, scaling back on compact cars and delaying its transition to electric vehicles due to falling demand.Analysts estimate that new tariffs could cost Mercedes and Porsche up to €3.4 billion ($3.7 billion).

Industry experts Bloomberg spoke to warn that these trade policies are creating chaos and thus creating roadblocks for automakers in their future product plans.