United States President Donald Trump has slapped 25 percent tariffs on all cars and car parts that are imported to the US. The 25 percent tariffs on car imports to US will go into effect on April 2, 2025.
Charges on businesses importing vehicles will then start the next day on April 3 while tariffs on car parts will start in May or later. Mexico and Canada are among the countries that are expected to be hit the hardest by the tariffs.
The two countries are already facing tremendous pressures from the United States following a series of tariffs that the Trump administration has slapped on them. However, the impact of the tariffs are expected to felt across all countries where US sources for auto parts and vehicles.
Currently, Mexico is the top foreign supplier of cars to the United States. It is followed by South Korea, Japan, Canada, and Germany. In 2024, the US imported around 8 million cars which accounted for about $240 billion in trade.
“In recent years, American-owned automotive manufacturers have experienced numerous supply chain challenges, including material and parts input shortages, labor shortages and strikes, and electrical-component shortages,” said Trump in his executive order that declared the 25 percent tariffs.
“Meanwhile, foreign automotive industries, propelled by unfair subsidies and aggressive industrial policies, have grown substantially.”
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Trump lamented that foreign cars and car parts had entered into the US market and dominated over US-made auto products.
“Today, only about half of the vehicles sold in the United States are manufactured domestically, a decline that jeopardizes our domestic industrial base and national security, and the United States’ share of worldwide automobile production has remained stagnant since the February 17, 2019,” he said.
