President of the United States Donald Trump on Wednesday, March 26, announced a 25% tariff set, which will take effect on April 2 and will affect all cars shipped to the US.
The mentioned decision on the next phase of tightening Washington’s tariff policy is a significant factor in the escalation of the global trade war, which is gradually becoming a fact of the current configuration of economic reality.
Before signing an executive proclamation in the Oval Office, Donald Trump said that the United States go to 25% from a 2.5% base.
It is worth noting that the new tariff will apply not only to foreign-made cars but also to auto parts, including engines and transmissions. Parts shipped from Canada and Mexico that comply with the United States-Mexico-Canada Agreement (USMCA) will be exempt from the levies until US Customs and Border Protection has a system in place to apply duties to non-US tariffs. This was announced by a White House spokesperson on the social media platform X.
Donald Trump said on Wednesday that he has been in touch with the Big Three automakers, including Stellantis, Ford, and General Motors. In this context, Mr. Trump noted that if companies have factories in the United States, they are thrilled. Donald Trump also said that those firms that do not have plants in the US will have to build appropriate facilities.
It is worth noting that the Big Three automakers have successfully lobbied for tariff exemptions for all goods coming to the United States from Canada and Mexico. In this case, it implies measures that were set to go into effect earlier in the current month.
The exemption, announced by Donald Trump, allows autos to come in duty-free if the vehicles are compliant with the terms of the USMCA free trade agreement. Later, Mr. Trump applied that to all products from the two countries. However, that is set to expire on April 2. Next week, Donald Trump may announce an increase in tariff rates for Mexico, Canada, and many other countries.
As we have reported earlier, US Adds More Chinese Companies to Export Blacklist.
