Donald Trump announced on Wednesday his intention to impose new tariffs on Imported cars. The measure is part of its aggressive economic strategy and could open a new front of tensions with neighboring countries and the European Union.
From the Oval office, the former president said that he will apply 25% tariff to “all cars that are not manufactured in the United States”, starting from the current 2.5% base. In their own words, these new tariffs will join the existing ones.
Entry into force. Although the announcement is already official, the new measures will not be applied immediately. The tariffs will enter into force on April 2, date that will also mark the beginning of the reciprocal measures long announced by the president.
The “great three.” Trump said he had addressed the issue with the main car manufacturers in the country – Ford, General Motors and Stellantis. In his own words, the message was clear: “If you don’t have factories here, you will have to start and build them.”
Increased Price in sight. As Tax Foundation points out, tariffs work, in practice, as taxes applied to imported products. That extra cost usually falls to importers, which in most cases transfer it directly to the final consumer.
Impact on exporters. If brands that manufacture cars outside the US fail to absorb the additional cost of tariffs, they could lose ground in front of local options. In that scenario, consumers would tend to choose vehicles produced within the country.
The US imports many cars. Although the automobile industry is part of the United States industrial DNA, the country depends largely on imports.
Almost half of the cars sold in the United States come from abroad, which amplifies the impact of new tariffs. According to 2024 data from World’s Top Exports, these are the main export countries and their weight in imports in the country.
- Mexico: 22.8%
- Japan: 18.6%
- South Korea: 17.3%
- Canada: 12.9%
- Germany: 11.7%
First reactions. Ursula von der Leyen, president of the European Commission, has said in X that it deeply regrets the US decision to impose tariffs on European automotive exports. He also says that “the EU will continue to seek negotiated solutions, but protecting their economic interests.”
Images | The White House | Yannis Zaugg
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