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Commercial vehicle makers shift to over-drive amid tariff blues

One of the major concerns triggered by the import tariffs rolled out by the government is its impact on the industry. It is natural that the automobile sector, which is yet to come out of the slowdown-induced gloom, falls on the receiving end. Automakers will have to revive their strategies if higher vehicle prices affect demand.

While an increase in prices could be damper for those who are planning to buy a new car, the market for off-road models and commercial vehicles like pickup trucks is unlikely to get affected as much. Adding to the woes of automakers, especially overseas firms having operations in the U.S., the government is weighing a proposal to tighten the ‘rules of origin’ for the sector.

In what could be seen as a strategy to override potential headwinds from the tariff, some of the leading commercial vehicle makers are busy revamping their product portfolio. If the current trend is any indication, several new models will be hitting the market by the year-end.

There is room for speculation that expansion projects initiated before the tariff hike would hit a roadblock as the companies might be forced to use the funds earmarked for such activities to meet the high steel costs.

The government is weighing a proposal to tighten the ‘rules of origin’ for the automobile industry

However, potential customers of commercial and off-road vehicles have much to cheer about in the coming months. The segment, currently dominated by Ford (F), will witness leading automakers rolling out new or revamped models.

This week, General Motors (GM) division GMC launched a ‘tougher’ version of its popular SUV model Sierra AT4, which is slated to hit the showrooms this fall. Going forward, the company intends to include an AT4 model in each of its vehicles categories.

Meanwhile, German auto giant Volkswagen is mulling production of a pickup truck for the U.S. market. By entering the relatively new segment, the company will be looking to repeat the success of the Beetle in America. The new model will be based on the company’s popular Atlas SUV and is likely to be assembled at the Chattanooga plant where Atlas also took shape.

Others getting ready to launch new versions of their pickup and off-road models include Chrysler-owned Ram Trucks, Ohio-based Jeep, and GMC’s sister Chevrolet.

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