President Trump Signs Executive Order That Blunts Auto Tariffs' Impact

Earlier this week, White House officials noted that President Trump may soften some of the planned automotive tariffs, and we now have a full picture of the plan. Yesterday, Trump signed an executive orde r that prevents some of the more damaging parts of the tariffs from taking effect.

While the planned 25 percent tariff on imported vehicles will move forward, the executive order targets “stacked” tariffs, which include additional duties on metals like steel and aluminum. Vehicles with a final assembly location in the U.S. may be eligible for a partial reimbursement of other tariffs, including the 25 percent duty on imported auto parts that will start later this week.

The president was in Michigan to announce the plan, saying, “We just wanted to help them during this little transition. If they can’t get parts, we didn’t want to penalize them.” Trump’s walk-back came after industry leaders lobbied the president for tariff relief. Automotive trade groups have said that many suppliers are already “in distress,” noting that they won’t be able to survive extended price increases.

Automakers said they were happy with the change, but they were clear-eyed about the challenges, including cost increases. Ford CEO Jim Farley said, “Ford welcomes and appreciates these decisions by President Trump, which will help mitigate the impact of tariffs on automakers, suppliers, and consumers.”

[Images: Ford, General Motors, Stellantis]

Become a TTAC insider. Get the latest news, features, TTAC takes, and everything else that gets to the truth about cars first by  subscribing to our newsletter.