U.S. President Donald Trump announced a 25% tariff on all cars manufactured outside the U.S. to support American production.
Details on the New Tariff
The 25% tariff will be applied to all cars made outside the U.S. starting April 2, as part of a broader plan to adjust trade relations. Auto parts produced in the U.S. but used in foreign cars are exempt. Trump stated: "We will impose a 25% tariff on all cars not made in the United States."
Reactions from Global Leaders
Foreign leaders quickly criticized the tariffs, fearing they may escalate a global trade war. European Commission President Ursula von der Leyen described it as "bad for business, worse for consumers." Canada's Prime Minister Mark Carney vowed to defend Canadian workers and companies from the impact of this move.
Impact on Prices and Jobs
Before Trump's announcement, U.S. auto stocks fell due to concerns about the potential impact on the global auto industry. New tariffs are expected to increase consumer prices, reduce sales, and impact jobs. If consumers bear the full cost of the new 25% auto tariff, the price of an imported vehicle could rise by $12,500, possibly contributing to overall inflation.
The tariff decision is part of Trump's broader strategy to reshape global trade. This move could significantly affect the market, prices, and employment in the auto industry.
