Trump Announces 25% Tariffs on Auto Imports
Trump thinks it “will lead to the construction of a lot of plants, in this case auto plants, and you’re going to see numbers that you haven’t seen both in terms of employment..”
President Donald Trump announced 25% tariffs on autos not made in America.
Trump: “What we’re going to be doing is a 25% tariff on all cars that are not made in the United States… business is coming back to the United States so that they don’t have to pay tariffs… This will continue to spur growth like you haven’t seen before.”
.@POTUS: "What we're going to be doing is a 25% tariff on all cars that are not made in the United States… business is coming back to the United States so that they don't have to pay tariffs… This will continue to spur growth like you haven't seen before." pic.twitter.com/GaMESdhpmE
— Rapid Response 47 (@RapidResponse47) March 26, 2025
White House Staff Secretary Will Scharf said the administration expects “these tariffs will result in over $100 billion of new annual revenue to the United States of America.”
White House Staff Secretary @willscharf: "In addition to spurring increased domestic manufacturing of cars and trucks, we expect that these tariffs will result in over $100 billion of new annual revenue to the United States of America." pic.twitter.com/ygnT65fR9Q
— Rapid Response 47 (@RapidResponse47) March 26, 2025
Trump originally planned 2.5% tariffs. The tariffs will go into effect on April 2. From Fox Business:
The president said he will impose a 25% tariff on all imported autos, up from 2.5% previously. He indicated the auto tariffs will take effect on April 2, when his reciprocal tariff plans are also expected to be announced.
Trump, who views tariffs as a way to bring in tax revenue to finance his plans for tax cuts while spurring a revitalization of domestic manufacturing, previously suggested that he could impose auto tariffs that run “in the neighborhood of 25%.”
In his Oval Office remarks, Trump said the tariffs “will lead to the construction of a lot of plants, in this case auto plants, and you’re going to see numbers that you haven’t seen both in terms of employment. It take a little while, you’ll have great construction numbers initially, and then ultimately you’re going to have a lot of people making a lot of cars.”
Here is a thread from the administration’s Rapid Response account:
NEW: @POTUS just signed an order imposing 25% tariffs on imports of automobiles and certain auto parts to end unfair trade practices and protect U.S. national security.
AMERICA FIRST!
THREAD:
For too long, America’s automobile industry has been battered by a flood of cheap imports — threatening our domestic industrial base and exposing us to global supply chain vulnerabilities.
Enough is enough.
Using his authority under Section 232 of the Trade Expansion Act of 1962, President Trump is adjusting imports to protect our national security.
A 25% tariff will be imposed on the following imports:
Passenger vehicles, including sedans, SUVs, crossovers, minivans, cargo vans, and light trucks
Key automobile parts, such as engines, transmissions, powertrain parts, and electrical components
Foreign automobile industries, propped up by unfair subsidies and aggressive industrial policies, have expanded. Meanwhile, U.S. production has stagnated. We’re reversing that trend NOW.
In 1985, U.S. owned and operated plants built 11 million automobiles—97% of overall domestic production.
In 2024, Americans bought approximately 16 million vehicles, but HALF were imports. Of the other eight million vehicles assembled in America and NOT imported, only 40-50% were American made.
Therefore, of the 16 million cars bought by Americans, only 25% of the vehicle content could be categorized as Made in America.
Our trade deficit in automobile parts hit a staggering $93.5 BILLION in 2024.
The U.S. auto industry employs approximately ONE MILLION Americans.
Auto parts manufacturing jobs total approximately 553,300. But we’ve lost 286,000 auto parts manufacturing jobs since 2000 – down 34%.
In 2023, U.S.-owned automakers accounted for just 16% of global R&D spending, while the EU dominated with 53%.
These tariffs will fuel American ingenuity and bring our edge back.
NEW: @POTUS just signed an order imposing 25% tariffs on imports of automobiles and certain auto parts to end unfair trade practices and protect U.S. national security.
AMERICA FIRST!
THREAD:
— Rapid Response 47 (@RapidResponse47) March 26, 2025
Using his authority under Section 232 of the Trade Expansion Act of 1962, President Trump is adjusting imports to protect our national security.
A 25% tariff will be imposed on the following imports:
Passenger vehicles, including sedans, SUVs, crossovers, minivans, cargo…
— Rapid Response 47 (@RapidResponse47) March 26, 2025
Our trade deficit in automobile parts hit a staggering $93.5 BILLION in 2024.
The U.S. auto industry employs approximately ONE MILLION Americans.
Auto parts manufacturing jobs total approximately 553,300. But we’ve lost 286,000 auto parts manufacturing jobs since 2000 – down…
— Rapid Response 47 (@RapidResponse47) March 26, 2025
In 2023, U.S.-owned automakers accounted for just 16% of global R&D spending, while the EU dominated with 53%.
These tariffs will fuel American ingenuity and bring our edge back.
— Rapid Response 47 (@RapidResponse47) March 26, 2025
Many auto companies have expressed or already announced manufacturing in America.
Trump claimed those who already have factories here like the tariffs: “If they have factories here, they are thrilled. If they don’t have factories here, they’re going to have to get going and build them because otherwise they have to pay tariffs. It’s very people. And most of them have pretty big factories here.”
Automakers are already planning major investments in the United States as @POTUS leverages tariffs to remake the U.S. into a global manufacturing powerhouse:
— Hyundai announced a $20 billion investment in the United States — including $5.8 billion for a new steel plant in…
— Rapid Response 47 (@RapidResponse47) March 26, 2025
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Comments
Is this going to do anything to result in American cars being as good as foreign cars? And what will prevent the UAW and dealers unions from taking full advantage of this?
There are these places called right to work states.
Since you brought it up…
BMW built their first North American body shop, paint shop and assembly hall to Spartanburg, SC in 1994 and began producing the E36 sedan. One of the first off the line had better fit and finish than the German-built E36 and it pissed Bayerische Motor Werken Teutans off so badly they hastily designed the Z3 Roadster to avoid further embarassment by those horrid Americans.
SC is a RTW state and on the verge of becoming motor city south. We have abundant skill here.
Honda start of manufacturing motorcycle someplace here, I think Ohio, many decades ago. Some of them were the same models as being brought in from Japan. They did a comparison on warranty claims, and the American bikes were having fuel warranty, claims or fit, and finish issues than the Japanese bikes. This was especially true of frame welding. At that time, none of the Japanese manufacturers could put a decent looking weld on a bike frame if they tried. The welds held obviously, but they were just ugly.
The South is by and large right to work and produces a wide array of automobiles. BMW in SC. Alabama hosts two.different production lines for Mercedes, Hyundai, Honda, Toyota, Mazda and Polaris plus another 100 or so parts manufacturers to.supply them. Tennessee has plants making Volkswagen, GM, Ford and Nissan. Other States as.well. Bottom line is the image of the US auto industry as confined to the ‘Big 3’ located in Michigan and Ohio by UAW is very much outdated.
There isn’t even a big three anymore, unless you count general voters Ford and Tesla. Chrysler is gone.
Exactly, the US auto industry ain’t ‘Detroit Cars’ anymore and hasn’t been for some time.
No, but it will, as tariffs always do, result in the prices of domestic goods rising to just under the prices of tariffed goods.
I’m not necessarily against it.
Companies left because of the insane auto unions making it functionally impossible to manufacture quality vehicles at reasonable profit margins.
But Detroit is a broken shell, nobody is going to build plants to make cars there.
There’s plenty of other states to build plants in without dealing with the insane auto unions.
We have already had two car companies announced major plans to bring production to the United States in order to evade these tariffs. The question of unions is a big one but it is possible for them to build in states that are right to work states. That means that the union can’t force people to pay fees in order to have a job. Unfortunately, you can’t keep the union out completely and they’ll still be a pain in the ass, but they can’t cripple your operation the same way as they can in a blue state
Production cycles in the auto industry are some of the longest in any industry. The fastest an automotive assembly plant can be retooled is numbered in years, not months, usually three or more, and this presumes there’s an existing plant that can be retooled. Jobs may be created due to these tariffs. But, they’re hugely unlikely to be created before the next presidential election.
That’s not all bad news. Once they’ve made that investment and sunk that money into, it’ll be harder for them to abandon it and offshore again.
Teamsters have crippled UPS
How so, that little brown truck drives past my house every day
“Democrat district judge orders all Americans to buy foreign made cars.”
How much longer before someone suggests an anti-dog eat dog edict?
Where is John Galt…
As I’ve said, I went to school to be an engineer and spent most of my life in the military, although I’ve worked in the private sector for almost 10-years now. But, it doesn’t take a rocket scientist or economist to understand that at least in the near term, this will be inflationary. There simply isn’t a 25% margin in automobiles, particularly those costing <250K, which is 99% of the cars sold. So, importers will be forced to either raise the price-point of their imported autos or simply not import them. Either one is inflationary. Why? The law of supply demand. Fewer imported cars means reduced supply.
Trump's singular reason for winning was his promise to reduce inflation 'on day one.' If vehicles – the 2nd biggest ticket item normies buy in their lifetimes – are appreciably more expensive a year from now, the Midterm elections are going to be indescribably disastrous. If he loses Congress, his presidency will be effectively over and a Democrat – any Democrat – will easily win in 2028. This is the political reality. BTW, 90-day auto-loan delinquencies have stabilized after climbing every month for the last 4-years. There are some legit green shoots right now. Hopefully this doesn’t smother them.
This presumes countries don’t flinch. If these tariffs are only levied for a few months and are removed after more favorable trade agreements are reached, it should only be a blip. But, if there are 25% auto tariffs on Mexico, Japan, South Korea and Canada a year from now, then yes, it’s going to be bad news for US consumer.
This guess this all just depends? If American manufacturing kicks in to high gear, employment opportunities are created and good quality products are available then the impact of inflation will be somewhat mitigated because you actually have real alternatives available…without even taking in to account the positive impact these new jobs and investment have on the national economy and in local pockets as people “invest” the money in their pockets in their local economies.
Where problems kick in is where we have the situation under Biden where inflation was being driven by out of control Government spending, money being syphoned out of peoples pockets which impact local economies as people either kept their money OR spent it on Amazon which resulted in it making no difference to the end user where anything came from.
Maybe/maybe not. Consumers have choices and someone shopping for a new vehicle can always choose one made in the USA v one made elsewhere. Consumers respond to incentives. So do the Nations whose auto manufacturers are being hit with tariffs. These Nations can alter their current tariff regimes on US products and end the many gov’t subsidies their manufacturing sectors enjoy.
You are absolutely correct on the timeline. New build manufacturing plants are a longer term horizon for going operational. There will be short term job creation in construction in the interim. Same as for increasing the # of US Vessels by increasing capacity for shipyards. Phase in rising tariffs for goods transported on foreign vessels and/or non US crew and we create incentives for shipping companies to buy US ships and to employ US Merchant Mariners.
I don’t think you understand ‘reduce inflation’.
Cars ARE big ticket items, bought very infrequently. They’re not part of the inflation stricken items consumers were complaining about. Groceries. Housewares. Energy. These are the things that people want fixed.
Cars are secondary.
A lot of “foreign” cars are already assembled in the US.
I see much of what Trump does is opening gambits.
I think so too, 2.5 % up to 25%…this isn’t over yet.
Hyundai doesn’t think this is an opening gambit.
Maybe but I’ll believe that plant when I see it.
Hyundai has two facilities in operations already. One in Alabama for over 20 years and one just over the line in GA. They employ about 9-10K directly, not including suppliers or retail business to serve the workers.
Anyone ever hear CNN et al say WHY tariffs are being imposed on countries like “the EU” and gone in to detail around the insane levels of protectionism the EU imposes on foreign car imports with the sole goal of protecting car manufacturing across Europe (while at the same time destroying their manufacturing base through Mann Made Global Warming ™ policies?
Seems if people understood the context of why tariffs are being imposed that they would be less likely to repeat the lie that tariffs dont work.
I believe Tesla has a car factory in germ.
Construction of new manufacturing facilities could take 3 years under best case scenario. Site selection for land, construction phase, hiring of employees. There is no quick fix there.
Tariffs have also been associated with decline in quality with american car makers. It has historically been the foreign made cars that forced american car makers to up their quality.
If you buy, sell (or benefit from side business related/near to) at a local farmer’s market, flea market, craft fair, trade show, etc. you are pro tariffs
america has been the liberal spender…the parent w/o a moral compass to stop the kids from eating cake right before dinner
trump says enough…so finally the MINORITY of americans who support fiscal responsibility
win one
we’ll take it
FCOL – how effin gullible can you get??? When will you rubes EVER catch on this conman.Fiscal responsibiltiy. PFFFFT .You might think the moron ‘ wasn’t President just 4 years ago. . How’d that fiscal responsibility go. Oh riiiiiight- he learned his lesson and now DOGE is going to fix everything. LAFFRIOT.
Do your homework.
https://reason.com/2025/03/05/trump-promised-a-balanced-budget-dont-believe-it/
https://www.nbcnews.com/news/trumps-budget-agenda-add-us-deficit-end-ap-rockys-gun-assault-trial-mo-rcna192752
It’s not worth building plants if it’s a bargaining chip, except that your own exports might increase if the bargaining works to bring down foreign tariffs.
Let’s face it, Orange Harvey is a moron. An abject one. And to make it worse – he doesn’t realize he’s a moron and surround himself with bootlickers who won’t tell him what a moron he is. And he has a cult following who are made up of uninformed, gullible rubes who can’t see what a buffoon he is.
All ‘the moron’ had to was consult an expert on tariffs like this guy.
https://reason.com/podcast/2025/03/27/phil-magness-the-problem-with-trumponomics/
Phil Magness: The Problem With Trumponomics
Economic historian Phil Magness on the real history of tariffs and why Trump is so wrong about them.
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