Trump has decided that U.S. tariffs on cars will be 25% from April 2, 2025, ending the uncertainty that had surrounded his intentions. From the U.S. President, this is a blow for any manufacturer in any part of the world, because the tariffs affect everyone. Taxes will also apply to a series of components. The new 25% will be added to the existing 2.5% barriers on foreign cars and the existing 25% on light trucks.
Trump’s 25% auto tariffs: global impact on automotive industry starting April 2025
The tariffs wanted by Donald Trump will hit not only Stellantis, but also American car manufacturers. These are indiscriminate tariffs against any country, without exception or exemption, with the EU on the list. All of Brussels’ threats against the USA have not served to protect the automotive sector. Thus, after the failure of the 2019 Green Deal and the failure of electric cars and fines for car manufacturers, here is the EU’s failure in relations with the United States, not forgetting that EU anti-China tariffs do not work. The automotive industry is worth about 40 billion euros of EU exports to the USA. According to Oxford Economics, the 25% tariffs on automotive particularly hit exports from Germany -7.1% and Italy -6.6%.
For his part, Trump protects the U.S. auto industry, which will have an enormous competitive advantage, representing a blow to European auto groups already in crisis. The European market is dying down, in China they don’t sell, in the United States there are tariffs, electric cars aren’t working: and now? This is why there is increasing talk of industrial reconversion from automotive to defense. For the White House occupant, April 2, 2025 will be a Liberation Day with similar trade barriers against Canada, Mexico as well as against the fifteen or so countries that have a chronic and structural trade surplus with the United States.
“Liberation Day is coming, the day when we will bring back to the United States all the money that has been taken from us for centuries. Companies are already coming back to invest in America, more than 5 trillion dollars have already arrived,” Trump declared.
How much of the cars sold in the United States are produced domestically, and how much are produced abroad, and by whom?
- Tesla: 100% United States.
- Ford: 77% United States, 21% Canada and Mexico, 2% other.
- Stellantis: 57% United States, 39% Canada and Mexico, 4% other.
- Nissan: 52% United States, 31% Canada and Mexico, 17% other.
- GM: 52% United States, 30% Canada and Mexico, 18% other.
- Toyota: 48% United States, 27% Canada and Mexico, 25% other.
- Kia: 33% United States, 8% Canada and Mexico, 59% other.
- Volkswagen: 21% United States, 43% Canada and Mexico, 36% other.