- The new vehicle tariffs will take effect on April 3.
- Trump’s administration targets countries with large trade surpluses with the U.S.
- Major exporters like Mexico, Japan, and Canada face economic setbacks.
- Stock markets in Japan and South Korea suffer sharp declines.
- Global leaders, including those from Europe and Canada, condemn the move.
The United States is set to impose fresh tariffs on imported cars and light trucks starting April 3, just a day after former President Donald Trump unveils his latest trade measures aimed at countries contributing most to the U.S. trade deficit.
These duties add to existing levies on steel, aluminum, and goods from key trading partners, including Mexico, Canada, and China.
Global Automakers Hit Hard
In 2024, the U.S. imported automotive products worth $474 billion, with passenger cars alone accounting for $220 billion. The biggest suppliers- Mexico, Japan, South Korea, Canada, and Germanyface economic uncertainty as Trump’s tariffs disrupt the industry.
Furious Reactions from World Leaders
European Commission President Ursula von der Leyen slammed the decision as “harmful for businesses and consumers.” Canadian Prime Minister Mark Carney went further, calling it a “direct attack” on Canadian workers and vowing to take retaliatory steps.
“We will stand up for our workers, our businesses, and our country,” Carney declared from Ottawa.
Japan and South Korea also reacted sharply. Tokyo is considering countermeasures, with Japanese Prime Minister Shigeru Ishiba warning that Japan will explore “all available options” to respond to the tariffs.
Meanwhile, Brazilian President Luiz Inácio Lula da Silva cautioned that Trump’s move could backfire. “These tariffs will drive up prices and potentially fuel inflation, something he hasn’t accounted for yet,” Lula remarked at a press conference in Tokyo, adding that Brazil plans to challenge the tariffs at the World Trade Organization.
Market Shockwaves
The announcement sent shockwaves through global financial markets, with stocks of major carmakers tumbling. Japanese auto giants Toyota and Mazda suffered steep losses, while Hyundai and Kia stocks dropped sharply in South Korea.
Trump Defends His Trade War Strategy
Despite widespread criticism, Trump insists the tariffs are necessary to protect American industries.
“We’re making other countries pay for doing business in the U.S. after taking our jobs, wealth, and resources for years,” he said from the Oval Office. “Friends have sometimes been worse than foes.”
While Trump argues that the tariffs will generate revenue and revive U.S. manufacturing, economic analysts warn of potential price hikes and disruptions in the auto sector. The coming months will determine whether this move strengthens America’s position or ignites a full-blown trade war.
