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General Motors Co.’s announcement this week that it will spend $4 billion to increase car production in the US is one of the biggest victories yet for those who argue President Donald Trump’s tariff tornado will unleash a domestic manufacturing resurgence. At the same time, GM’s investment underscores why it’s so hard to orchestrate a broader reshoring of factory work to the US.
As part of this push, GM plans to shift some assembly of several top-selling and highly profitable models, including the Chevrolet Silverado and GMC Sierra pickup trucks and the Chevrolet Equinox SUV, from Mexico to the US. The higher profit margins on those vehicles give GM more room to absorb the elevated labor, infrastructure and regulatory costs that come with manufacturing in the US, whereas it will continue to take advantage of lower-cost plants in Mexico for its cheaper vehicles — and for reduced volumes of the models that are moving. Mexican Economy Minister Marcelo Ebrard separately said GM told him it doesn’t expect layoffs or plant closures in that country.
