Trump's "Auto Tariffs" Face Changes Again? White House Confirms Exemptions, Canada's Tariff Rate May Increase!

It is reported that US President Trump is planning to exempt car manufacturers from some of the harshest tariffs. Media analysis suggests that this is another concession made by the US in the trade war following intense lobbying by industry executives in recent weeks.

According to another media report, the White House confirmed on Wednesday that Trump is indeed considering exempting car manufacturers from some tariffs. Additionally, there are reports that Trump intends to exempt some tariffs on auto parts, including those on imported steel and aluminum products.

Insiders revealed that Trump's move is referred to as "destacking" of tariffs. However, it is important to note that the above exemptions will retain Trump's 25% tariff on all imported foreign-made cars (complete vehicles) and will not affect the 25% tariff on imported auto parts set to take effect on May 3.

Furthermore, Trump also stated on Wednesday that the 25% tariff on cars imported from Canada to the US could be increased.

He told reporters in the Oval Office, "When I impose tariffs on Canada, they pay 25%, but for cars, the tariffs might go up. What we're doing is saying, 'No offense, we don't want your cars. We really want to make our own cars.'"

The auto industry is "fighting back."

Over the past week, auto industry executives have intensified their criticism of the tariffs, with Stellantis Chairman John Elkann warning that Trump's trade policies "put the US and European auto industries at risk." Another auto executive also stated, "We have urged the government not to impose these tariffs on us over and over again... because it truly endangers the health of our industry."

Additionally, six major organizations representing the US auto industry have unusually united to lobby the Trump administration against imposing these tariffs. These organizations represent franchised dealers, suppliers, and nearly all major automakers, but Tesla, Rivian, and Lucid are not on the list of automakers they represent.

In a letter to Trump administration officials, they stated that the impending tariffs could jeopardize US auto production. The letter noted that many auto suppliers are already "in distress" and cannot afford additional cost increases, leading to broader industry issues.

President Trump has expressed willingness to reconsider the government's 25% tariff on imported auto parts—similar to the recently approved tariff exemptions for consumer electronics and semiconductors. "This would be a positive development and a welcome move," the letter stated.

Therefore, Trump's latest concession will mark an initial victory for the auto industry and also indicate that Trump is once again "backing down" on his most aggressive tariff policies.

Trump also hinted last week that he would provide "help" to the auto industry. Previously, he proposed offering more favorable treatment for cars imported from Mexico and Canada as long as companies comply with the 2020 USMCA agreement.

For complete vehicles and parts that meet the terms of the USMCA agreement, only the "non-US content" portion will be subject to a 25% tariff. Insiders told the media that the current focus of negotiations is mainly on how to simplify the implementation of tariffs, such as simplifying the rules on the origin of auto parts.