President Donald Trump has delayed tariffs on automobile imports from Canada and Mexico for a month after leaders’ demands at the Big Three Automakers – General Motors, Ford and Stellantis – hoping that they will move any offshore operations in the United States until April 2.
The repetition, which Politico reported for the first time, comes less than two days after Trump issued 25% tariffs for all goods from US neighbors, which had previously been tasked under a North American trade agreement (sometimes characterized as Oil 2.0) negotiated during its first term.
Vehicle manufacturers have complex supply chains and operate some manufacturing facilities in Mexico and Canada. For example, GM produces Chevy Equinox in Mexico and Canada, and both Ford Lincoln Nautilus and Dodge’s charger of Stellantis are made in Ontario. Multiple automobile suppliers also have factories in both countries.
Car prices are already at high historical levels, and tariffs threaten to send up to $ 12,000, according to Jeff Schott, an old associate at the Peterson Institute for the International Economy, which was interviewed by Detroit Free Press. This can lead to less demand, leaving traders stuck with unbearable cars in their parts.
In a speech at Congress on Tuesday, Trump called on manufacturers to move their offshore operations. White House press secretary Karoline Leavitt said at a conference Wednesday that Trump expects GM, Ford and Stellantis to shift production in the US before tariffs begin at the end of the month.
“He told them they have to deal with him,” Leavitt said.
Ford Director General Jim Farley said last month in a Talk investor the company does not have excessive capacity in its plants to relocate production. Farley noted that Ford could resist tariffs in the short term, but if they continued, they “would blow a hole in the American industry we have never seen”.
Through February, nearly half of all new vehicles sold in the USA were built in the US, but 17.4% of them were built in Mexico, and 7.4% in Canada, according to Edmunds.com data.
This article has been updated with information by the White House press secretary.
