U.S. President Donald Trump is considering sparing carmakers from some tariffs following weeks of intense lobbying by auto industry executives, the Financial Times reported on Wednesday, citing sources familiar with the matter.
According to the report, the Trump administration may exempt certain car parts imported from China from upcoming tariffs, even as it moves ahead with duties on imported steel and aluminum.
Despite these potential exemptions, the White House is expected to maintain the 25% tariff Trump imposed on all foreign-made cars. A separate 25% duty on imported auto parts, scheduled to take effect on May 3, is also likely to remain in place, the FT added.
The development comes as the U.S. auto sector grapples with the uncertainty caused by the administration’s shifting tariff policies. The levies are projected to increase car prices, squeeze margins for manufacturers and suppliers, and complicate global supply chains.
Earlier this month, the Center for Automotive Research estimated that Trump's proposed 25% tariffs on automotive imports would raise costs for automakers by approximately $108 billion by 2025.
Separately, Tesla has suspended plans to ship components for its Cybercab and Semi electric trucks from China to the U.S., due to the escalating tariff environment, a source familiar with the matter told Reuters. The move may delay the company's plans to begin mass production of the highly anticipated models.
Ford, meanwhile, said last week it had halted shipments of certain vehicles to China as retaliatory tariffs pushed total taxes on some cars as high as 150%, severely impacting competitiveness in that market.
According to the report, the Trump administration may exempt certain car parts imported from China from upcoming tariffs, even as it moves ahead with duties on imported steel and aluminum.
Despite these potential exemptions, the White House is expected to maintain the 25% tariff Trump imposed on all foreign-made cars. A separate 25% duty on imported auto parts, scheduled to take effect on May 3, is also likely to remain in place, the FT added.
The development comes as the U.S. auto sector grapples with the uncertainty caused by the administration’s shifting tariff policies. The levies are projected to increase car prices, squeeze margins for manufacturers and suppliers, and complicate global supply chains.
Earlier this month, the Center for Automotive Research estimated that Trump's proposed 25% tariffs on automotive imports would raise costs for automakers by approximately $108 billion by 2025.
Separately, Tesla has suspended plans to ship components for its Cybercab and Semi electric trucks from China to the U.S., due to the escalating tariff environment, a source familiar with the matter told Reuters. The move may delay the company's plans to begin mass production of the highly anticipated models.
Ford, meanwhile, said last week it had halted shipments of certain vehicles to China as retaliatory tariffs pushed total taxes on some cars as high as 150%, severely impacting competitiveness in that market.
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