Auto File-Boneshaker tariffs, plus Nissan goes Rogue

April 15 - By Nick Carey, European Autos Correspondent

Greetings from London!

Many years ago, in the throes of a different economic crisis, former British prime minister Harold Wilson famously said that “a week is a long time in politics.”

The last week may have seemed the equivalent of a year to some, not least those trading in U.S. Treasuries, which were hammered by President Donald Trump’s tariffs. This could cause long-term problems, including higher interest rates for U.S. mortgages and car loans.

Trump’s ever-changing tariff policy took another shift on Monday as he suggested he might grant exemptions on auto-related levies already in place.

But some major automakers are not waiting to find out if Trump’s tariffs are permanent or not and have already started making big production decisions. Consumers, too, continue to make purchase decisions based on the threat of higher prices.

Which brings us to today’s Auto File …

• Harley tariff rush

• Nissan makes a tariff bet

• China taps brakes in Latin America

French bikers say “oui” to pre-tariff Harleys

The prospect of retaliatory European tariffs on Harley-Davidsons has French bikers rushing to buy an iconic boneshaker before they take effect.

Motorcycles were on a list of American goods due to be hit by EU tariffs announced last week in response to Trump. After Trump rowed back on some of his tariffs, the EU suspended its levies but said they could still kick in if negotiations fail.

As my Reuters colleague Lucien Libert reports from a Villiers-Sur-Marne Harley-Davidson dealership outside Paris, bike sales are brisk as French bikers reckon they had better hurry if they want the American motorcycle of their dreams before trade war puts them out of reach. You can read about it here.

"It's now or never," one prospective Harley-Davidson buyer said as he ogled some gleaming bikes.

Recommended reading:

• Mercedes bails on small vans

• Nuro secures $6 billion valuation

• S. tariffs foster China-EU trade talks

Nissan’s tariff-fueled Rogue move

Nissan is cutting back on Japanese production of the Rogue, its top-selling model in the United States, in response to Trump’s tariffs.

As a source tells my Reuters colleague Maki Shiraki, Nissan will lower production of the Rogue from May to July at its plant in Kyushu, southwest Japan. You can read about it here.

Workers at the plant, Nissan's largest, will work fewer hours from May through July, with production halted on some days. The automaker will reassess the situation later, depending on tariffs.

Nissan sold almost 246,000 Rogues in the United States last year, accounting for more than a quarter of its U.S. vehicle sales. Nissan also makes Rogue models in Smyrna, Tennessee.

Nissan had already backtracked on a separate plan to cut output at Smyrna, saying it would maintain two shifts for the Rogue, rather than one as had been scheduled for April.

China delays Latin American car plans

China has delayed approval for plans by Chinese automakers Geely and BYD to make cars in Latin America as U.S. tariffs have increased economic uncertainty and because of the risk of technology transfer.

Geely and Renault said in February Geely would use the French automaker's plants in Brazil and take a minority stake in Renault's local business unit.

BYD announced plans for a Mexican plant in 2023 and said last year it would reveal its location by the end of 2024.

But approval from Beijing has taken longer than anticipated for both projects and China's state planner has told the automakers their plans contain technology transfer risks, sources told Reuters.

One source told Reuters regulators have become stricter and more cautious on investments by Chinese automakers abroad, lengthening the review timeline and requesting more backup materials.

Pirelli’s U.S. investment on hold

Pirelli has paused plans to invest more in the United States while it tries to defuse tensions over links to Chinese state-owned group Sinochem, its largest investor.

Sinochem has a 37% stake in Pirelli and is at odds with the company and its Italian shareholders over governance issues.

This comes amid increasing challenges of running a Chinese-affiliated business in the United States, one of Pirelli's key markets.

About 25% of Pirelli’s sales are in North America, which it mostly serves through plants in Mexico, South America and Europe. It also runs a smaller factory in the U.S. state of Georgia.

The Italian government intervened in 2023 to curb Sinochem's powers in Pirelli and shield management's autonomy.

Pirelli has made it clear it wants to boost its U.S. investments, which would help limit the impact of U.S. tariffs.

But in one of its final acts in January, the Biden administration announced a ban on key software and hardware from Chinese-controlled companies, which will take effect for software in the 2027 model year for cars and hardware as of 2029.

Fast Laps

General Motors temporarily halted production of electric commercial vans at its assembly plant in Ontario due to slow sales.

Tesla suspended new orders for its U.S.-made Model S and Model X vehicles on its Chinese website.

Volkswagen's truckmaker Scania will buy bankrupt Northvolt's division that makes battery packs for heavy industry.

Stellantis remains committed to its ailing luxury Maserati brand despite U.S. tariffs.

Chinese EV battery giant CATL's first-quarter net profit grew at its fastest pace in nearly two years, while a rise in revenue ended five quarters of decline.

Rental car firm Hertz said some of its users' data was stolen in a breach involving one of its vendors.

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