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Trump Flip-flops on Auto Tariffs Again
The auto industry is sounding the alarm over President Donald Trump’s latest trade announcement, which will impose a 25 per cent tariff on automobile imports and auto parts to the U.S., effective April 2. The sweeping tariffs, which will now apply to all foreign-manufactured vehicles and parts. Previously, analysts were expecting the tariffs to target only certain imports, but Trump reversed course on previous exemptions.
The move is set to have significant consequences for both U.S. and Canadian jobs, with the Canadian Chamber of Commerce warning the move could add thousands of dollars to vehicle prices on both sides of the border.
The auto sector, which relies on highly integrated cross-border supply chains, could face disruptions as parts often cross between the U.S. and Canada multiple times during the manufacturing process.
Industry experts suggest the tariffs could lead to production shutdowns in the US and Canada while further increasing uncertainty for autosector workers. The tariffs are adding to existing challenges posed by tariffs on steel, aluminum, and other auto parts.
The announcement sent shockwaves through financial markets, with shares of automakers like GM and Stellantis dropping sharply in trading yesterday. Meanwhile, the European Union is threatening retaliatory tariffs, escalating tensions with some of America’s largest trading partners.
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