North Carolina’s booming automotive manufacturing sector—home to more than 300 companies and 37,000 workers—is facing renewed uncertainty as new federal tariffs on steel and aluminum threaten to raise costs and stall momentum in one of the state’s fastest-growing manufacturing industries.
According to the Economic Development Partnership of North Carolina (EDPNC), Companies include: Damier, Toyota, Bridgestone, Thomas Built Buses, Caterpillar, and many more. In addition, 20 of the top 100 global original equipment manufacturers (OEMs) have operations in the state. The automotive industry is the largest manufacturing industry in the southeast, employing more than 37,000 workers in the state.
“Our auto industry sector has enjoyed a 23% growth since 2014, but these latest tariffs on steel and aluminum threaten that success,” Brian Balfour, VP of research for the John Locke Foundation, told the Carolina Journal. “The added costs of inputs will either generate higher prices for vehicles, which consumers can scarcely afford or compel manufacturers to cut back in other ways – most notably in cutting payroll.”
One of the state’s largest automotive companies is Toyota, which appears to be taking a “wait and see” approach to shifting tariff policy. On Tuesday, the White House announced a 50% increase in the tariffs on steel and aluminum imports effect June 4, 2025. The increase is likely to impact automotive manufacturers in North Carolina.
“Toyota has been part of the cultural fabric in the US for more than 65 years, and our philosophy has always been to build where we sell and buy where we build,” said Emily Holland, manager of corporate communications for Toyota North America. “With over $50 billion invested in the US, including 10 US manufacturing plants and more than 49,000 direct jobs, we are fully compliant with the USMCA trade agreement and will continue to deepen our investments in America. Like the entire auto industry or any other global business, we will continue to adapt to trade policies to meet customer needs.”
Although VinFast’s North Carolina facility remains under construction, the Economic Development Partnership of North Carolina (EDPNC) lists the EV manufacturer as one of the state’s major automotive companies. First announced in 2022, the Chatham County plant broke ground in August 2023 but has since faced repeated delays. The site remains unfinished with no active operations, and the company has recently shifted focus to Asia, launching a new plant in Indonesia nearly a year after construction began in North Carolina. The VinFast project was awarded a taxpayer-funded Job Development Investment Grant (JDIG).
VinFast may receive up to $316.1 million in state reimbursements through JDIG over the next 30 years, contingent on meeting its hiring targets. The state also committed to investing $450 million in infrastructure improvements near the site. Altogether, the state’s total financial commitment amounts to approximately $766 million, while Chatham County is offering the company an additional $400 million incentive.
Wolfspeed, an EV battery component manufacturer that also received a JDIG grant, could also be impacted by such tariffs. However, it was reported in May that Wolfspeed is expected to file for Chapter 11 bankruptcy. This follows internal shakeups the company underwent last November, including laying off 20% of its workforce. Gregg Lowe, president and CEO of Wolfspeed since 2017, also stepped down in November.
School buses play a significant role in North Carolina’s automotive industry, with 12,000 currently in operation across the state. One of the key manufacturers is Thomas Built Buses, based in High Point, which produces school, activity, and childcare buses and distributes them through a nationwide dealership network. As a subsidiary of Daimler Truck North America (DTNA), the company could be significantly affected by the new federal tariffs on steel and aluminum—key materials in bus manufacturing.
Balfour warns that higher input costs may strain operations, increase vehicle prices, or lead to cuts elsewhere, putting pressure on one of the state’s major automotive employers.
“We are closely monitoring and evaluating the situation, recognizing that tariffs affect international business for any global company,” according to a statement sent to the Carolina Journal from Daimler Truck North America. “Daimler Truck North America has extensive experience in managing trade agreements, which has allowed us to consistently operate our business in compliance with all past and present regulations. We anticipate that tariffs will impact North American vehicle manufacturing costs, potentially impacting prices. As the situation evolves, our priority is to support our customers and provide stability while collaboratively navigating the complexities of these tariffs.”
As North Carolina continues to position itself as a hub for automotive innovation and manufacturing, the sector’s future may hinge on how companies adapt to rising material costs and shifting global trade policies. With billions in state and local incentives on the line—and thousands of jobs tied to the industry—tariff pressures could test the resilience of both established manufacturers and emerging players alike.
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