GM Shifts Mexican Vehicle Production to U.S. Plants in $4bn Bet on Gas-Powered SUVs Amid Trade Pressure

General Motors announced an investment of $ 4 billion in three American assembly factories, part of a radical reshuffle of its North American manufacturing operations which include the reinstalling of the production of two vehicles currently built in Mexico.

This decision comes as the automaker sails the growing pressure of aggressive trade policies of the Trump administration, including 25% prices on imported vehicles and many automotive parts.

The new investment – implemented until 2027 – will finance additional production of the Blazer Chevrolet at gas and Chevrolet Equinox in American factories, while converting a Michigan factory once finished, initially designated for all electric trucks, in the center for SUVs and gas trucks.

A source familiar with GM’s plans said that the production of the Blazer would fully go from Mexico to the United States, while the assembly of equinox in the United States would increase, and not replace the current production of the Ramos Arizpe factory in Mexico. GM did not clarify the future of the Mexican factory, but change is already interpreted as a political and economic victory for Trump’s prices, which came into force earlier this year.

GM has said that the investment will allow it to produce more than two million vehicles per year in the United States by the end of the investment cycle.

From electric vehicle dreams to pricing realities

The plan also points out a retreat from the anterior aggressive thrust of GM in electric vehicles. The Orion’s assembly plant in Michigan, once planned to become the second exclusive installation of the company’s EV, will now be restiluting to manufacture gas vehicles instead.

This marks a significant pivot at a time when GM had engaged billions in electrification, echoing a broader trend in the automotive industry, where car manufacturers refer EV ambitions in the midst of persistent cost pressures, regulatory uncertainty and slower adoption of consumers.

GM insists that change is rooted in market realities and consumer demand. “Today’s announcement demonstrates our continuous commitment to building vehicles in the United States and supporting American jobs,” said CEO Mary Barra, noting that GM remains concentrated on the supply of customers between electric and combustion vehicles.

The Fairfax assembly plant in Kansas will start to build the gas equinox in mid-2010, while the Spring Hill factory in Tennessee will add the production of Chevrolet Blazer during the same year.

Although GM has refrained from directly connecting its decision to political pressure, the timing leaves little room for ambiguity. Automotive prices of 25% of Trump creating new uncertainty in the sector, GM has spent the last months analyzing its production footprint while the leaders have adopted a cautious position “to wait and see”. This caution has now moved to tactical adjustments.

Investment is considered by analysts as a nod to economic nationalism and a response to political -opposite winds.

“We believe that the future of transport will be motivated by American innovation and manufacturing expertise,” said Barra, indirectly echoing the themes that Trump has defended since his return to the White House.

GM maintained its capital expenses of 2025 between $ 10 and 11 billion dollars, but now expects annual expenses between 10 and 12 billion dollars to 2027, likely to adapt to the new reshuffle of its manufacturing plans.

Balance prices and strategy

During a recent investor event in Bernstein, the financial director of general manager Paul Jacobson minimized panic surrounding the prices, saying that the impact may not be “as bad as the market reacted to.” He noted that GM could mitigate between 30% and 50% of costs related to prices without new capital expenses in the short term. However, this last investment suggests that the company now takes longer -term measures to restructure its operations to absorb the current political risks.

Meanwhile, Mary Barra hinted that in spite of challenges, the new commercial landscape could also open doors. “You will see us very resilient … and seize opportunities where vehicles succeed,” she said, referring to high demand for GM gas SUVs.

The change of the car manufacturer also highlights how tariff threats and changing trade alliances accelerate broader recalibrations in global supply chains, in particular while car manufacturers like GM plan to deactivate over-dependence on Mexico and strengthen domestic production capacity in forecasting additional regulatory turbulence.

This American manufacturing thrust not only experiences GM’s references as a patriotic brand under political control, but also aligns it with an increasing achievement in the automotive industry: that consumer preference for SUVs powered by gas remains strong, even if EV investments are examined for long -term profitability.