Trump plans to ease tariffs on US auto imports

President Donald Trump will sign an executive order Tuesday aiming to reduce the impact of auto tariffs on U.S. automakers, White House officials said.

The Wall Street Journal reported Monday that the White House is set to announce a new tariff structure for cars that avoids “stacking” tariffs on top of other import taxes already in place, such as additional 25% duties on foreign steel and aluminum.

Autos and parts subject to the 25% Section 232 autos tariffs would no longer be subject to other tariffs imposed by Trump, including 25% duties on Canadian and Mexican goods, as well as 10% duties applied to most other countries.

“This deal is a major victory for the President’s trade policy by rewarding companies who manufacture domestically, while providing a runway to manufacturers who have expressed their commitment to invest in America and expand their domestic manufacturing,” Commerce Secretary Howard Lutnick said in a statement to CNN on Monday.

The executive order set to be unveiled later Tuesday comes as Trump is scheduled to travel to Michigan.

Related: Imports from China now face tariffs of up to 245%, White House says

Trump’s tariffs on imports of assembled vehicles into the U.S. went into effect April 3, and duties on auto parts are set to take effect Saturday.

Vehicles and auto parts that are compliant with the United States-Mexico-Canada Agreement are exempt from most of the import tariffs, but confusion remained as to the duties’ effect on global supply chains, auto industry experts said.

Officials for General Motors (NYSE: GM) said Tuesday investors could no longer “rely” on its previous forward earnings guidance as the auto industry tries to decipher the impact of Trump’s tariffs on automotive goods, as well as steel and aluminum.

GM said in January that it expected net profits in the range of $11.2 billion to $12.5 billion for full-year 2025.

“We’re going to look for more clarity before we get into any forward projections of the tariff exposure, and that’s why we’re going to tell people that you can’t rely on the guidance that we had issued before, because we do believe that [the tariff effect] could be material,” GM CFO Paul Jacobson said on a call with analysts Tuesday to discuss first-quarter earnings. 

Ford (NYSE: F) CEO Jim Farley expressed support for Trump’s decision to lessen the impact of import duties on the U.S. auto industry.

“Ford welcomes and appreciates these decisions by President Trump, which will help mitigate the impact of tariffs on automakers, suppliers and consumers,” Farley said in a statement to the media.

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