Trump 25% tariffs on Cars imported into the USA

Trump 25% tariffs on Cars imported into the USA


President Donald Trump on Wednesday announced a 25% tariff set to take effect on April 2 on all cars shipped to the United States, a significant escalation in a global trade war.“We start off with a 2.5% base, which is what we were at, and we go to 25%,” Trump told reporters on Wednesday before signing an executive proclamation in the Oval Office. The tariff will be applied not just to foreign-made cars but also to car parts, including engines and transmissions. Parts coming from Canada and Mexico that comply with the United States-Mexico-Canada Agreement (USMCA) will be exempt from the tariffs until US Customs and Border Protections has a system in place to apply tariffs to non-US tariffs, a White House spokesperson said in a post on X.The move didn’t come as a huge surprise to automakers. An executive at one of the automakers, who spoke on background to CNN on Wednesday, said they had already been working with the assumption that auto tariffs would take effect next week.“We were all kind of expecting April 2 to be our day,” said the auto executive. “But if the Trump administration has shown us anything, I mean, things are unexpected.”

Ontario Premier Doug Ford said Canada should retaliate. “I’ve spoken with Prime Minister Carney. We agree Canada needs to stand firm, strong and united,” Ford said in a post on X. “I fully support the federal government preparing retaliatory tariffs to show that we’ll never back down.”Given the auto tariffs include parts, they could quickly raise the prices of new cars by thousands of dollars, according to industry experts. There is no such thing as an all-American car, since all depend on parts from Mexico and Canada for a significant part of their content. Parts from the two countries could soon be subjected to the tariffs Trump unveiled Wednesday.According to analysis by Michigan-based think tank Anderson Economic Group, the cost of producing vehicles built at US plants will rise by between $3,500 to $12,000 each.

Some Mexican-assembled vehicles, like the Chevrolet Blazer or Honda HR-V could be priced out of the market, and automakers might decide to stop offering them altogether rather than build them at US factories. Cars built in Mexico are most often lower-priced, lower-profit models that are only able to maintain their profitability by being built with cheaper Mexican labor.It’s not only the smaller, entry-level models built in Mexico that could see price hikes. Trump’s auto tariffs could impact many models that car buyers don’t realize are imports, such as the heavy duty versions of Ram pickup trucks, which are built in a Stellantis plant in Saltillo, Mexico. Some versions of the Chevrolet Silverado are also built in Mexico. Even if the automakers shift production of those more profitable vehicles back from Mexico to US factories, it would take years to accomplish the switch.

The US exported $35.8 billion worth of parts to Mexico last year, according to federal trade data, and another $28.4 billion of parts to Canada. Parts suppliers, who employ about 550,000 workers or nearly twice as many as work in auto assembly plants, could be forced to cut back their production and staffing if Canadian and Mexican plants shut down, even temporarily.In addition, United States car exports to Canada and Mexico were significant, with $14.9 billion going to Canada and $4.6 billion to Mexico. If those countries retaliate with their own tariffs on US-assembled vehicles, it could force some US assembly plants to scale back their own production.Canadian auto plants built 1.3 million vehicles last year, of which 1.1 million, or 86%, were exported to US dealerships.There were a total of 4 million vehicles built in Mexico in 2024, according to data from S&P Global Mobility, of which 2.5 million, or 61%, were shipped to the United States.Cox Automotive estimates that about 30% of North American auto production, or roughly 20,000 vehicles a day, will shut down

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After Liberation Day by the Orange Pest ....

Two weeks later, car assembly plants will start to shut down.

Watch the reversal....

In reply to sgtdjones

You'll soon see Chinese BYD dealerships opening soon, if not already.

BYD Dolphin Surf is nicer and is a more affordable alternative to Tesla's Model Y.

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...Trumps ....Ludwitt told PM Ford tariffs will be lowered for Canada and Mexico.

When an orange moron is in charge, such happens...

deflection from his security breach by inexperience dummies

Automakers aren’t rushing to move production to US factories to avoid tariffs


President Donald Trump predicted Wednesday that the auto tariffs he is about to impose will lead automakers to shift their car production and their supply chains to American factories. However, it is not that simple. Not by a long shot. The Canadian and Mexican tariffs will be the most damaging to most automakers, which depend on those neighbouring countries not just for some of their production but for a large share of the parts they use to assemble cars. Trump’s remarks suggest the shift can be accomplished quickly and without downsides. But that’s far from the truth; there’s no such thing as an American-made car.

But after seeing Canadian and Mexican tariffs announced and then put on hold a couple of times already this year, automakers aren’t really sure what’s next. And even if they believe the tariffs will be in place for as long as Trump is in office, they say there’s no way to quickly pivot to significantly limit the costs of the tariffs being passed onto car buyers. The automakers came up with their supply chains and geographic distribution of plants with the understanding that previous trade deals, including the United States Mexico Canada Agreement (USMCA) which was negotiated by Trump during his first term, allowed them to operate as if North America was essentially a single market.

But even if the tariffs stay in place throughout Trump’s term, and they’re not part of a negotiating strategy to change the USMCA North American free trade agreement, automakers say it is difficult to build plants based on one administration’s tariff policy. “It’s three years at best for brand new automotive capacity that could potentially span into a new administration, where the rules could change,” said the executive. “So just by the time that capacity was coming online, you might find that was no longer your optimal footprint.” One plant that Trump heralded during his recent address to Congress, as well as in remarks Wednesday, is a new Honda plant in Indiana, which he said will be among the biggest anywhere. He said on Wednesday that Honda had started construction, but Honda confirmed hours later that it had not announced any such plans. In his recent remarks to investors, Ford's Farley stated, "Let us be honest: Long term, a 25% tariff across the Mexico and Canada borders would blow a hole in the US industry that we have never seen."

This too shall pass