Trump to back down by easing tariffs on auto parts

On Tuesday, the administration of US President Donald Trump will take steps to reduce the impact of automobile tariffs, according to Reuters and Bloomberg.
According to officials, the tariffs will be eased on foreign-made auto parts produced domestically, and there will be no new tariffs on parts for vehicles manufactured abroad. A White House representative also stated that automakers will not be held responsible for other tariffs on aluminum and steel.
This shift in thinking comes as Trump prepares to visit Michigan - the heart of the US automotive industry - to mark the 100th day of his second presidential term.
"President Trump is building an important partnership with both the domestic automakers and our great American workers," Commerce Secretary Howard Lutnick said in a statement provided by the White House."This deal is a major victory for the President's trade policy by rewarding companies who manufacture domestically, while providing runway to manufacturers who have expressed their commitment to invest in America and expand their domestic manufacturing.”
Reuters reports that last week, a coalition of automotive industry groups approached Trump, urging him not to impose a 25% tariff on imported auto parts, warning that it would lead to reduced car sales and higher prices. Trump had previously stated that he planned to implement such a tariff no later than May 3.
"Tariffs on auto parts will scramble the global automotive supply chain and set off a domino effect that will lead to higher auto prices for consumers, lower sales at dealerships, and will make servicing and repairing vehicles both more expensive and less predictable," the industry groups said in the letter.
They added that most auto suppliers are unprepared for the abrupt disruption caused by the introduction of tariffs. Furthermore, many are already in a difficult situation and will face production shutdowns, layoffs, and bankruptcies.
Trump's auto tariffs
On Wednesday, April 2, US President Donald Trump signed an executive order imposing a 25% tariff on vehicles imported to the US. The tariffs on vehicles came into effect the next day, April 3.
The same order addressed tariffs on auto parts, which, according to the document, were set to take effect on May 3.