US President Donald Trump said yesterday an extra 25% tariff would be coming on imports of foreign made automobiles and parts.
It comes as not all his threatened levies would be imposed on April 2, which he has termed “liberation day” for the US.
The White House claims that the US auto industry has been “undermined by excessive imports threatening America’s domestic industrial base and supply chains.”
Tariffs are being levied under section 232 of the Trade Expansion Act (1962), which it said allows for the President to impose tariffs under national security reasons.
It will be targeted at passenger vehicles, including sedans, SUVs, crossovers, minivans, cargo vans and light trucks, it said.
The tariffs will also focus on key auto parts, which it said includes engines, transmissions, powertrain parts, and electrical components.
There will be processes to expand tariffs on additional parts, if necessary, it said.
Automobile importers under the United States-Mexico-Canada Agreement (USMCA) will be given time to certify the number of components made in the US, it said.
This will allow for them to have only non-US components to be tariffed, it said.
USMCA-compliant vehicle parts will not have any tariffs until the US secretary of state will make a process to for tariffs to non-US components, it said.
It also claims that in 2024, of 16 million vehicles being brought, 50% of them were imported. With the other 8 million US-made vehicles allegedly having an estimated 40-50% of US-made components, it said.
These tariffs are aimed to shrink a $1.2 trillion global goods trade deficit by raising U.S. levies to levels charged by other countries and counteracting their non-tariff trade barriers, according to Reuters.
