US President Donald Trump announced on Wednesday that the country will impose steep tariffs on imported cars, a move likely to heighten tensions with key trading partners. “What we’re going to be doing is a 25 per cent tariff on all cars that are not made in the United States. This will be permanent,” Trump said in the Oval Office. However, vehicles produced within the country won’t face any tariffs,” he said. The new policy, which will take effect on April 2, will target foreign-made cars and light trucks, adding to the existing tariffs already in place.
Since returning to office in January, Trump has introduced tariffs on imports from major US trading partners, including Canada, Mexico, and China. He also imposed a 25 per cent duty on steel and aluminum imports.
However, automakers in North America were previously given a temporary exemption from these tariffs.
The uncertainty surrounding Trump’s trade policies has made financial markets unstable, with many investors concerned about the possibility of an economic downturn. Meanwhile, consumer confidence has dropped in recent months as people worry about the potential impact of these new tariffs.
Trump has been a long-time supporter of tariffs as a way to address trade imbalances, but his aggressive approach has caused market instability and raised concerns among investors, business leaders, and consumers.
Back in February, Trump had mentioned the possibility of a 25% tariff on imported cars but didn’t share specific details. Then, on Monday, he hinted that the new auto tariffs would be announced “very soon.”
There was also speculation that Tesla CEO Elon Musk influenced the decision. However, Trump denied any involvement from Musk. “Musk did not advise me on auto tariffs,” he clarified. “He has never asked me for a favor,” Trump added.
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