Trump set to ease tariff impact on US car makers

President Donald Trump is scheduled to hold a rally in Michigan on Tuesday to celebrate his first 100 days in office. During this event, he is expected to announce measures aimed at reducing the impact of tariffs on American car manufacturers. According to a senior official from the White House, Commerce Secretary Howard Lutnick, this initiative represents a significant victory for the President's trade policy, as it rewards companies that produce their goods domestically. The President's plan includes lowering some import duties on parts that are brought in from other countries and used in vehicles made in the United States. While cars manufactured outside the country will still face automotive tariffs, they will not incur additional charges like those imposed on steel and aluminum products, as reported by the Wall Street Journal. The rally in Michigan is particularly noteworthy because the state is home to the so-called Detroit Three automakers: Ford, General Motors (GM), and Stellantis, along with a vast network of over 1,000 major suppliers to the automotive industry. Trump has made tariffs a central element of his economic strategy, famously describing them as 'the most beautiful word in the dictionary. ' However, these tariffs have led to turmoil in global financial markets, created significant uncertainties for businesses, and raised concerns about a potential economic slowdown. The decision to alleviate the burden on the automotive sector is seen as the latest effort by the Trump administration to demonstrate flexibility regarding its trade policies. Mary Barra, the CEO of GM, expressed her gratitude for the President's support of the US automotive industry and the millions of Americans who rely on it. In a statement to the BBC, she said, 'We appreciate the productive conversations with the President and his Administration and look forward to continuing to work together. ' Ford also welcomed Trump's decision, stating that it would help lessen the impact of tariffs on automakers, suppliers, and consumers. The company added that it would continue to collaborate closely with the administration to support the President's vision for a healthy and growing auto industry in America. Ford emphasized that policies encouraging exports and ensuring affordable supply chains are essential for promoting domestic growth. They also noted that it is crucial for major vehicle importers to match Ford's commitment to building in America, as this could lead to a 'windfall of new assembly and supplier factories and hundreds of thousands of new jobs. ' John Elkann, the chairman of Stellantis, echoed the sentiments of his competitors, expressing optimism about the tariff reliefs. He stated, 'We look forward to our continued collaboration with the US administration to strengthen a competitive American auto industry and stimulate exports. ' Last week, a coalition of US motor industry groups urged the President not to impose a 25% tariff on imported car parts. In a letter to his administration, representatives from companies including GM, Toyota, and Volkswagen warned that such levies would result in higher auto prices for consumers, reduced sales at dealerships, and increased costs for servicing and repairing vehicles. Trump had previously indicated that the tariffs would take effect by May 3. This situation highlights the ongoing challenges and discussions surrounding trade policies and their impact on the American automotive industry.