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Daimler AG today said it will build the next-generation Mercedes-Benz Sprinter van in North America, shifting some production from Germany to improve competitiveness.

Automotive News reported that Daimler currently assembles Sprinters in Ladson, South Carolina, from kits shipped from Germany. The company did not say where future North American production will be.

“We can cover the growing demand for large vans in the North American market economically only if we produce the vehicles locally in the NAFTA region,” Volker Mornhinweg, head of the Mercedes’ vans division, said in a statement.

Mornhinweg said Daimler will decide on the exact location for the future production of the Sprinter in the NAFTA region during the coming months. The NAFTA region includes Mexico, the United States and Canada.

Because of the high import tariffs, Daimler has been producing Sprinters for the U.S. market in German plants at Duesseldorf and Ludwigsfelde. The vans are partially dismantled in a time-consuming process and reassembled  in Ladson for the Mercedes and Freightliner brands.

Daimler says this process results in a significant competitive disadvantage, since it leads to long delivery times and makes the vehicle more expensive for U.S. customers.

The U.S. is now the Sprinter’s second-largest sales market after Germany, according to Daimler, with about 23,000 Sprinter vans delivered to U.S. customers last year.

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