Mercedes-Benz owner Daimler is embracing the “Buy American” philosophy promoted by President Trump.
Mercedes-Benz will increase the number of American parts used at its factory in Alabama, saying it “sees value” in having more local suppliers.
The move comes amid fresh criticism from President Trump over the large trade gap the United States has with Germany.
A spokesperson for the Stuttgart-based automaker said the decision to buy more U.S.-made components was not the result of pressure from the Trump administration.
Instead, Mercedes-Benz said it hopes to persuade more suppliers to set up shop near its Tuscaloosa plant in order to increase efficiency and cut transport time for parts. The plant, which employs over 3,600 workers, is already in the midst of a $1.3 billion expansion.
“Our suppliers have found — just as we have — that Alabama is a great place to do business,” Mercedes-Benz executive Jason Hoff said in statement.
Mercedes-Benz says it’s on a multi-year push to source more local parts at each of its 29 global factories.
It’s on track in Alabama. Eighty percent of components used in C-Class models built at the plant are sourced from the U.S. and Canada, according to the National Highway Traffic Safety Administration. That’s up from 55% in 2016.
The share of American and Canadian parts used in GLE-Class SUVs has also increased to 65%.
Still, the shadow of politics looms. Mercedes-Benz () matches the profile of two of Trump’s favorite trade targets — it’s a foreign automaker, and it’s based in Germany.
Trump used his first few months in the White House to heap pressure on automakers to increase production in the U.S. and hire more American workers.
The industry responded with promises of new investments. (Many of which were in the works before Trump took office.)
In recent days, Trump has turned his attention to Germany.
“We have a MASSIVE trade deficit with Germany, plus they pay FAR LESS than they should on NATO & military. Very bad for U.S. This will change,” Trump tweeted on Tuesday morning.
In 2016, the U.S. trade gap with Germany was $67.8 billion, the second largest in the world. America’s trade deficit with China, at $310 billion, was the only one larger.
About one third of the German-U.S. trade gap is due to German car sales.
Americans bought about 1.3 million cars from German automakers including Mercedes-Benz, Volkswagen () and BMW ( ) in 2016.
But each of those manufacturers builds cars at plants in the United States. About 250,000 of the German cars bought in the U.S. were actually made on American soil.