Trump mulls auto tariff exemptions as industry pushes back

US President Donald Trump is considering exemptions for automakers from certain tariffs as it would cover auto parts imported from China, which face tariffs aimed at curbing fentanyl production, as well as tariffs on steel and aluminium.

However, the exemptions would not include the 25% tariffs on imported vehicles or the 25% tariffs on auto parts scheduled to start on May 3, according to a CNBC report.

In addition to this, Trump suggested that the 25% tariff on cars imported from Canada to the US might increase. Speaking to reporters in the Oval Office, he said, “When I put tariffs on Canada — they’re paying 25% — but that could go up, in terms of cars. All we’re doing is we’re saying, ‘We don’t want your cars, in all due respect. We want, really, to make our own cars.’”
The US automotive industry, grappling with multiple tariffs, has been lobbying for relief. Existing 25% tariffs on steel, aluminium, and all imported vehicles already burden the sector. The additional 25% tariff on auto parts set for May 3 has raised concerns about rising costs.

Earlier this week, six major US automotive policy groups, representing franchised dealers, suppliers, and nearly all major automakers, united to urge the Trump administration to reconsider these upcoming auto parts tariffs.

In a letter to Trump officials, they wrote, “President Trump has indicated an openness to reconsidering the administration’s 25 percent tariffs on imported automotive parts – similar to the tariff relief recently approved for consumer electronics and semiconductors. That would be a positive development and welcome relief.”

The groups warned that the new tariffs could disrupt US automotive production and harm suppliers already struggling financially.

Mary Barra, CEO of General Motors, speaking at Semafor’s World Economy Summit, emphasised the need for clear and consistent regulations to guide investment decisions and said, “First of all, I need clarity, and then I need consistency.”

“To make those investments and to be good stewards of our owners’ capital, I need to understand what the policy is.” Barra added that GM has made minor adjustments to its operations due to shifting trade policies but is holding off on major changes until US regulations are clearer.