Trump announces 25% prices on car imports to us

Natalie Sherman & Michael Race

Business reporters, BBC News

Watch: Trump announces a 25% price on cars “not manufactured in the United States”

President Donald Trump announced new taxes on 25% import on cars and automotive parts in the United States in a decision that threatens to widen the World Trade War.

Trump said the latest prices would come into force on April 2, with accusations on companies that import vehicles from the next day. The costs on the parts should start in May or later.

The president said that the measure would lead to “enormous growth” for the automotive industry, promising that it would stimulate jobs and investment in the United States.

But analysts said this decision should lead to the temporary closure of significant cars production in the United States, increase prices and tension relations with allies.

The United States imported approximately eight million cars last year, representing approximately $ 240 billion (186 billion) in commerce and about half of the overall sales.

Mexico is the best foreign car supplier in the United States, followed by South Korea, Japan, Canada and Germany. Trump's latest decision threatens to upset the world of cars and supply chains.

Many American automotive companies also have operations in Mexico and Canada, under the terms of the long-standing free trade agreement between the three countries.

The White House said that the order would apply not only to finished cars but also to car parts, which are often dispatched to other countries before gathering in the United States.

However, the new parts on Canada and Mexico parts are exempt while customs and American border patrols have created a system to assess the tasks, the White House said. The neighboring countries see the goods of a crossed border value every day.

General Motors' actions on Wednesday slipped around 3%. The sale has spread to other companies, including Ford, after the president's remarks, because he confirmed the prices.

Questioned at a press conference if there was a chance that he was reverse the course, Trump said no, adding later: “It's permanent.”

“If you build your car in the United States, there is no price,” he said.

Japanese Prime Minister Shigeru Ishiba said his government would put all options on the table “in response to prices.

Japan, which houses several major giants in the automotive industry, is the second largest car exporter in the world.

The actions of Japanese car manufacturers – including Toyota, Nissan, Honda – fell at the start of Tokyo.

Getty images

A price is a tax on imports collected by a government and is paid by the company that imports the property.

Trump adopted the tool, seeking to apply it to a multitude of goods imported into the United States as part of a greater desire to protect American companies and stimulate manufacturing.

But although measures can protect national companies, they also increase costs for companies that depend on foreigners, as is the case for car manufacturers.

Analysts have estimated that the cost of a car could increase thousands of dollars, with 25% of Mexico and Canada parts, adding $ 4,000 to $ 10,000 depending on the vehicle, according to Anderson Economic Group.

'Direct attack'

Taxes on fresh cars on cars should come into force on the same day that so-called reciprocal rates are triggered for individual countries according to their commercial relationship with the United States.

It is not clear how the car rates could affect these plans.

But many countries, including the United Kingdom, are concerned about the fact that their exporters are struck by new taxes.

The United States was the largest sales market in Jaguar Land Rover based in British last year, the automaker selling 116,294 vehicles to Americans, exceeding sales to customers in the United Kingdom and China.

The British government is in talks with the American administration and hopes a trade agreement before the prices come into force, includes the BBC.

Watch: Automobile tariffs a direct attack '', explains Canadian Prime Minister Mark Carney

Canadian Prime Minister Mark Carney described Trump’s announcement of “direct attack” against his country and his automotive industry.

“It will hurt us, but through this period by being together, we will emerge stronger,” he said.

The president of the European Commission, Ursula von der Leyen, said that the block would examine the measures before any potential response.

“As I have already said, prices are bad taxes for businesses, worse for consumers also in the United States and the European Union,” she said.

“The EU will continue to seek negotiated solutions, while protecting its economic interests.”

For the United Kingdom, the United States is the second largest car export market after the EU, mainly luxury cars sent across the Atlantic, according to the Industry Organization, the Society of Motor Manufacturers and Traders (SMMT).

Mike Hawes, the Director General of SMMT, urged British and American governments to “meet immediately and conclude an agreement that works for everyone”.

The automotive industry was already struggling with broad prices on steel and aluminum that Trump has set up earlier this month.

In recent weeks, large automotive companies such as Ford and General Motors have urged the president to exempt the industry from any other function.

A study in 2024 of the United States International Commerce Commission predicted that a 25%rate on imports would reduce imports by almost 75%, while increasing average prices in the United States by around 5%.

But Trump made this decision, which is a renewal of an action he first considered during his first mandate in the White House.

The White House officials said he wanted the American workers to affect more rooms, not just assembling them and maintained that their action pushes companies to move.

A day before the last rates, the South Korean Giant of Agoine Hyundai announced that it would invest $ 21 billion (16.3 billion) in the United States and build a new steel factory in the southern state of Louisiana.

Trump praised the investment as a “clear demonstration that prices work very strongly”.

The head of the Uniti-Travailleurs union of United, Shawn Fain, who had opposed Trump in the elections, praised the actions of the president, affirming that he “intensified the end of the free trade disaster which devastated the communities of the working class for decades”.

Elsewhere, the leader of the commercial group L'Mérican Automotive Policy Council, Matt Blunt, said: “American car manufacturers are attached to the vision of President Trump to increase automobile production and jobs in the United States.”

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