Donald Trump announces 25% tariffs on all imported cars
26 March 2025, 21:41 | Updated: 26 March 2025, 22:12
Donald Trump has announced fresh tariffs on all car imports to the United States.
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New 25% tariffs on imported cars will come into effect on the 2nd of April, Trump confirmed on Wednesday.
He declared the move will bring "tremendous growth" to the car industry, raising around "$100 billion."
"This will continue to spur growth," the president told reporters.
"We'll effectively be charging a 25% tariff."
The tariffs could be complicated as even US car makers source their components from around the world, meaning that they could face higher costs and lower sales.
Shares in General Motors fell by about 3% in Wednesday afternoon trading. Ford's stock was up slightly, but shares in Stellantis, the owner of Jeep and Chrysler, dropped nearly 4%.
Mr Trump has long said that tariffs against car imports would be a defining policy of his presidency, betting that the costs created by the taxes would cause more production to relocate to the US.
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Mexico is the largest supplier of cars to the US, followed by South Korea, Japan, Canada and Germany.
The tariffs are part of a broader reshaping of global relations by Mr Trump, who plans to impose what he calls "reciprocal" taxes on April 2 that would match the tariffs and sales taxes charged by other nations.
He has already placed a 20% tax on all imports from China for its role in the production of fentanyl.
He similarly placed 25% tariffs on Mexico and Canada, with a lower 10% tax on Canadian energy products.
The president has also imposed 25% tariffs on all steel and aluminium imports, removing the exemptions from his earlier 2018 taxes on the metals.
He also plans tariffs on computer chips, pharmaceutical drugs, lumber and copper.
His taxes risk igniting a broader global trade war with escalating retaliations that could crush global trade, potentially damaging economic growth while raising prices for families and businesses as some of the costs of the taxes get passed along by importers.
When the European Union retaliated with plans for a 50% tariff on US spirits, Mr Trump responded by planning a 200% tax on alcoholic beverages from the EU.
He also intends to place a 25% tariff on countries that import oil from Venezuela, even though the US also imports oil from that nation.
