WASHINGTON: World powers on Thursday blasted US President Donald Trump’s steep tariffs on imports of vehicles and car parts, vowing retaliation as a widening trade war intensifies.
Major car exporter Germany called for a firm response from the EU, while Japan said it “will consider all options”.Stock markets across Asia and Europe skidded into the red as auto manufacturers from Toyota to Hyundai and Mercedes led the plunge.
The US duties will take effect at 12:01am (0401 GMT) on April 3 and impact foreign-made cars and light trucks. Key automobile parts will also be hit within the month.“What we’re going to be doing is a 25 per cent tariff on all cars that are not made in the United States. If they’re made in the United States, it is absolutely no tariff,” Trump said at the White House.
France Finance Minister Eric Lombard condemned the “hostility”, saying that the “only solution for the European Union will be to raise tariffs on American products in response”.Canada’s Prime Minister Mark Carney said he had convened a meeting Thursday to “discuss our trade options”.
As Washington’s major trading partners warned of retaliatory action, Trump ramped up his threats.“If the European Union works with Canada in order to do economic harm to the USA, large scale Tariffs, far larger than currently planned, will be placed on them both in order to protect the best friend that each of those two countries has ever had!” Trump posted on his TruthSocial network.
But Trump’s levies rattled domestic manufacturers too, with his top ally and Tesla boss Elon Musk admitting his company would not be spared the pain.“To be clear, this will affect the price of parts in Tesla cars that come from other countries. The cost impact is not trivial,” Musk wrote on X.
The association of American Automakers warned in a statement that the tariffs must be implemented in a way that “avoids raising prices for consumers” and preserves the industry’s competitiveness.
‘Cheaters’
The Centre for Automotive Research has previously estimated that US tariffs — including those on imported autos and metals — could increase the price of a car by thousands of dollars and weigh on the jobs market.
But Peter Navarro, Trump’s senior counsellor for trade and manufacturing, in a briefing after Trump’s announcement, blasted “foreign trade cheaters” who he said turned America’s manufacturing sector into a “lower wage assembly operation for foreign parts”.
He took aim at Germany and Japan for reserving the construction of higher-value parts to their countries.
Since beginning his second term in January, Trump has imposed fresh tariffs on imports from major US trading partners Canada, Mexico and China — alongside a 25 per cent duty on steel and aluminium.
The latest levies will be in addition to those already in place.But the White House added that vehicles entering under the US-Mexico-Canada Agreement (USMCA) can qualify for a lower rate depending on their American content.
Similarly, USMCA-compliant auto parts will remain tariff-free as officials establish a process to target their non-US content.
‘Devastating impact’
Uncertainty over Trump’s trade plans and worries they could trigger a downturn have roiled financial markets, with consumer confidence also falling in recent months.Trump has defended the levies as a way to raise government revenue and revitalise American industry.
