automotive

Trump Announces 25% Auto Import Tariff, Effective April 2, 2025

United States (US) President Donald Trump signed an order to impose a 25% tariff on car imports. This policy is also considered to be further expanding the trade war. Reporting from Bloomberg on Thursday (3/27/2025), the policy is designed to bring more manufacturing jobs to the US. Trump said the tariffs apply to all cars that are not made in the United States. "We are going to put tariffs on countries that do business in our country and take our jobs, take our wealth, take a lot of things that they have taken over the years," Trump said at the White House. The president said the tariffs would take effect on April 2, 2025 and the US would start imposing them a day later. 

The White House said the tariffs would apply not only to fully assembled cars but also to major car parts, including engines, transmissions, powertrain parts, and electrical components. The list could be expanded over time to include additional parts. Trump said the tariffs were permanent and he was not interested in negotiating any exceptions. Shares of General Motors Co., Ford Motor Co., and Stellantis NV fell in after-hours trading as Trump spoke. 

The White House said in a fact sheet that importers whose vehicles are covered by the United States-Mexico-Canada Agreement (USMCA) will be given the opportunity to certify their U.S. content and that the system will be implemented so that the 25% tariff will only apply to the value of their non-U.S. content. White House Staff Secretary Will Scharf said the tariffs will go into effect alongside existing levies. The administration projects the tariffs will generate $100 billion in new annual revenue for the U.S. The move comes ahead of Trump’s April 2 announcement of targeted reciprocal tariffs — an effort to lower barriers to other countries and narrow the U.S. trade deficit. The tariffs would see the U.S. apply tariffs on a country-by-country basis to counter the barriers imposed on American imports. However, Trump has hinted that some trading partners may receive possible exemptions or reductions. Other industry-specific tariffs are also being drafted, with Trump threatening to impose levies on lumber, semiconductors and pharmaceuticals. “That’s the real American Liberation Day, and it’s going to be April 2nd, and I look forward to it,” Trump said Wednesday. The auto levies mark a significant expansion of the president’s trade war, and are likely to ensnare some of the biggest auto brands in countries including Japan, Germany and South Korea, all major U.S. trading partners. The move risks disrupting operations for North American automakers, which rely on highly integrated chains across the U.S., Mexico and Canada. However, the tariffs will affect non-U.S. content in some of Detroit’s most recognizable and profitable models. GM imports some of its Chevrolet Silverado pickup trucks from plants in Mexico and Canada, while Stellantis makes models including the Jeep Compass SUV in Mexico. Ford produces a larger share of the U.S. domestic market than its Detroit rival, but it won’t be immune to the impact. Ford also makes its entry-level Maverick small pickup truck in Mexico as well as the Bronco Sport SUV. 

Tag: Donald Trump USMCA White House