Trump's huge tariffs will have major impact on nearly half the cars that make up the US market

Donald Trump has officially unveiled a 25 per cent tariff on "automobiles and specific automobile parts," intensifying the ongoing trade war.

Those changes would impact imported cars, which made up nearly half of the cars bought in the US market in 2024, according to White House trade advisor Peter Navarro.

On Wednesday (26 March), the US president revealed that the new tariff will come into effect on 2 April, calling it "the beginning of Liberation Day in America".

Inside the Oval Office, he added: "If you build your car in the United States there will be no tariff."

"The 25 percent tariff will be applied to imported passenger vehicles (sedans, SUVs, crossovers, minivans, cargo vans) and light trucks, as well as key automobile parts (engines, transmissions, powertrain parts, and electrical components), with processes to expand tariffs on additional parts if necessary," The White House stated.

"Importers of automobiles under the United States-Mexico-Canada Agreement will be given the opportunity to certify their U.S. content and systems will be implemented such that the 25 percent tariff will only apply to the value of their non-US content."

When Trump was asked whether carmakers could do something to have the tariffs removed, he replied: "This is permanent, 100 per cent."

Getty Images

White House trade advisor Navarro added: "The foreign trade cheaters have turned America into a lower-wage assembly operation for foreign parts that threatens our national security because it’s eroded our defense and manufacturing industrial base.

"Half of the roughly 16 million cars, SUVs and light trucks Americans bought in 2024 were imports - that’s 50 percent. Of the remaining eight million units, more than half of these cars were assembled from foreign parts.

"So what that means is less than 25 percent of the cars sold in America contain US content on average. That stops right now with the Trump auto tariffs."

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