Trump has imposed tariffs on foreign cars. What the media is writing
US President Donald Trump announced the introduction of tariffs on foreign cars and spare parts in the amount of 25%. This is expected to lead to higher machine prices and affect production within the United States. In Canada, this step was compared to an attack on the country. What the media write about the new US duties is in the Izvestia digest.
CNN: tariffs on cars will be introduced on April 3
On March 26, Trump announced the imposition of 25 percent duties on all cars supplied to the United States, which was a significant escalation of the global trade war. The tariffs will take effect on April 3. For decades, because of the free trade agreement, automakers have treated Canada, Mexico, and the United States as one big country, without imposing tariffs between them.
CNN
"To be honest, a friend was often much worse than an enemy. And what we're going to do is impose a 25 percent tariff on all cars that are not manufactured in the United States," Trump told reporters Wednesday before signing an executive proclamation in the Oval Office.
The new duties will apply not only to foreign cars, but also to automotive parts, including engines and transmissions. Duties on spare parts should come into force "no later than May 3," according to the text of the decree signed by Trump. Car companies will almost certainly pass on the additional costs to consumers, especially since they cannot easily move all of their supply chains to the United States.
The New York Times: car duties will lead to higher prices
After Trump imposed a new 25 percent tariff on foreign cars, new cars are likely to become much more expensive in the United States. Research firm Cox Automotive estimates that the tariffs will add $6,000 to the price of a car made in Mexico or Canada, the two largest car exporters in the United States. The United States also imports many cars from Japan and South Korea, with fewer coming from Germany, Italy, Sweden, and the United Kingdom.
The New York Times
Higher prices will scare off buyers and force automakers to cut production, said Jonathan Smoke, chief economist at Cox Automotive. He predicts that American factories will produce 20,000 fewer cars per week, about 30% less than usual. <...> In addition to affecting car buyers, duties can harm Americans working in factories and car dealerships.
According to the Bureau of Labor Statistics, about 1 million people in the United States are employed in the manufacture of cars and spare parts. Another 2 million work in dealerships. If automakers are forced to significantly reduce production, they will likely send workers to factories on unpaid leave, and dealers will have to cut jobs if high prices hurt sales.
Reuters: Trump's tariffs hit automakers' stocks
American automakers and their global competitors were shocked by Trump's announcement that he would impose 25 percent duties on all foreign-made vehicles and auto parts imported into the United States. According to GlobalData, a research company, almost half of all cars sold in the United States last year were imported.
Reuters
In response to this news, General Motors shares fell by 8% in aftermarket trading. Ford shares and U.S.-traded shares of Chrysler's parent company Stellantis fell about 4.5% each. In Asia, shares of Toyota Motor, Honda Motor, Hyundai Motor all fell between 3% and 4%. Shares of Tesla, which manufactures all cars sold there in the United States, but with some imported parts, fell 1.3%.
Trump said the duties could be neutral or even beneficial for Tesla. He added that his close ally and the owner of the company, Elon Musk, did not give him advice on car duties. According to Trump, car duties will encourage manufacturers to increase investments in the United States, rather than in Canada or Mexico. Musk himself said that tariffs will affect the cost of parts.
NBC: Trump agrees to lower tariffs for China in case of TikTok sale
Trump said he could provide China with a "small tariff reduction" if the country's government approves a deal with TikTok brokered by his administration. The bill, which obliges the Chinese owner of the ByteDance platform to sell the application to a non-Chinese buyer or face a nationwide ban, was signed by the previous US President Joe Biden.
NBC
The social media platform challenged the measure, but the Supreme Court upheld it in the final days of the Biden administration. TikTok briefly shut down operations in the United States just before Trump's inauguration, but resumed operations after the president signaled he would reconsider the ban. On his first day in office, Trump signed an executive order giving the app and ByteDance until April 5 to sell TikTok or liquidate it.
Since the executive order was signed, Vice President J.D. Vance has been working with National Security Adviser Michael Waltz to find a buyer. In recent months, rumors have continued to circulate about potential buyers of TikTok, which has millions of users and a valuation of $50 billion. ByteDance has not made public comments since Trump signed the executive order on January 20. The company has also not confirmed its willingness to sell the app.
Associated Press: Canadian Prime Minister calls Trump's tariffs an attack on his country
Canadian Prime Minister Mark Carney has said that the car duties imposed by Trump are a "direct attack" on his country and that the trade war is hurting Americans. He called the decree unjustified and announced that he would interrupt the election campaign in order to hold a meeting of the government's special committee on relations with the United States.
Associated Press
"It's a very direct attack," Carney replied. — We will protect our employees. We will protect our companies. We will protect our country. <...> Canada will support workers in the automotive industry."
Automobiles are Canada's second largest export item. Carney noted that 125,000 Canadians are directly employed in this industry and almost 500,000 more people in related industries. Earlier, the politician announced the creation of a $1.4 billion "strategic response fund" that will protect jobs in the Canadian automotive industry affected by Trump's tariffs.
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