President Donald Trump announced a 25% tariff on all foreign cars and trucks of manufacturing, increasing his longtime trade war against foreign competitors and strengthening his “America First” protection program.
The prices, formalized in a presidential proclamation signed in the oval office on Wednesday, will take effect on April 2, the government should start to pay tasks the next day.
Trump said that there would be “absolutely no price” on cars built in the United States, effectively inciting national and foreign car manufacturers to move production to American soil If they wish To avoid additional costs.
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The assistant of the White House Will SCHARF stressed that the new prices will apply in addition to existing import rights, predicting that they will generate more than $ 100 billion in new annual income for the United States government.
However, the details of the measurement remain vague, as modern cars are assembled from thousands of parts from dozens of countries. Trump reassured that there would be a “very strong police” to determine which components are subject to new prices.
Trump’s challenge in the World Trade War
Trump’s latest tariff movement is part of its broader business war strategy, which was marked by incessant distrust of the pressure of global trade partners. Over the years, Trump has targeted China, the European Union, Canada, Mexico and Japan with various prices, arguing that unfair trade policies have harmed the American workers and industries.
During his first mandate, Trump imposed a price of 25% on steel and a 10% rate on aluminum imports, triggering reprisal measures of the European Union, China and other nations. He also imposed a massive set of prices on Chinese products, rising hundreds of billions of dollars, projection To curb Beijing’s influence on the world markets.
Trump has largely ignored criticism of economic analysts who warn that prices often affect consumers and businesses by increasing prices and disturbing supply chains. Instead, he developed the tariff war as a battle for economic independence, arguing that American manufacturers were unjustly disadvantaged by decades of free trade agreements that benefit foreign producers.
Which countries will be affected?
The 25% car rate of Trump will have a massive global impact, affecting some of the largest car producing countries in the world, including:
- Japan: shelters Toyota, Honda, Nissan, Subaru and Mazda, Japan exports millions of vehicles to the United States every year. The price will considerably increase the cost of Japanese cars sold in the United States
- Germany: A Major ball for car manufacturers such as BMW, Mercedes-Benz and Volkswagen, who depend strongly on American sales. Many German luxury models are imported rather than built in American factories.
- South Korea: Hyundai and Kia, who produce cars in the United States but still import an important part, will be hardly affected.
- Mexico and Canada: While Trump temporarily exempt from vehicles built in Mexico and Canada under the US-Mexico-Canada (USMCA) agreement for a month, many fear that the exemption could be revoked.
- China: Although China exports relatively few finished cars in the United States, certain Chinese automotive parts and electric vehicle components could still be affected.
- United Kingdom, France and Italy: luxury brands like Rolls-Royce, Bentley, Ferrari, Aston Martin and Peugeot will be faced with higher costs when selling American consumers.
Immediate global backlash
Trump’s announcement was quickly sentenced by world leaders and economic experts. The president of the European Commission, Ursula von der Leyen, promised that the European Union would take countermeasures to protect its economy.
“The European Union will continue to seek negotiated solutions, while protecting its economic interests,” said Von Der Leyen. She also pointed out that “rates are taxes” that will harm companies and consumers.
Stock markets reacted negatively to news, automotive actions falling heavily In Trading after opening hours. The actions of General Motors, Ford and Stellantis all dropped by around 5%, while European and Japanese car manufacturers have also experienced losses.
Salle for potential exemptions and negotiations
While Trump imposed difficult commercial measures, his administration reported a few flexibility. The Treasury Secretary, Scott Bessent, recently said that countries could be able to pre-negotiation of exemptions before the prices come into force on April 2.
Asset se Having hinted that the final price plan could be less severe, saying last week that there will be “there will be flexibility” and that certain prices could be “more indulgent than reciprocal”.
However, given that Trump’s history of unpredictable commercial decisions, business leaders and world car manufacturers remain in advance, uncertain about If other trade tensions – or even the reprisals of other nations will follow.
While Trump presented his pricing war as a path of economic victory, analysts warn that high costs of imported cars could be transmitted to American consumers, which increases prices on millions of vehicles.
Car manufacturers, both national and foreign, will now have to decide to absorb costs, transmit them to consumers or move production in the United States, American trade partners should repel, preparing the field for another series of world commercial conflicts in the coming weeks.
