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The US president is set to impose an additional 25% tariff on auto imports this week
US President Donald Trump has said he “couldn’t care less” if automakers raise prices when a new round of tariffs takes effect, as is expected, this week.
Trump said last week the new auto tariffs would come into force from April 3, when the US will begin collecting an additional 25% duty on hundreds of billions of dollars’ worth of imported cars and auto parts from Mexico, Canada, South Korea, Japan, and Germany.
While Trump claimed that the import tax could generate between $600 billion and $1 trillion in revenue over the next two years, the EU’s biggest economies and Canada have threatened to retaliate.
Though experts have warned that car prices are likely to surge once the tariffs take effect, Trump told NBC on Saturday “I couldn’t care less, because if the prices on foreign cars go up, they’re going to buy American cars.”
Trump declared last week that new tariffs would mark “the beginning of Liberation Day in America.”
“We’re going to take back just some of the money that has been taken from us,” the US president claimed.
An anonymous White House official told Politico on Wednesday the new 25% tariff will also apply to auto parts, targeting an additional $192 billion in imports from Mexico, Canada, China, Germany, Japan, and other key suppliers. The US imported $214 billion worth of passenger cars in 2024 with the majority of auto imports coming from the same five countries, according to data from the Commerce Department.
Mexico, Canada, and South Korea currently have duty-free access to the American auto market under free trade agreements that Trump renegotiated during his first term. Cars imported from Canada and Mexico will be taxed based on their non-US content, the outlet cited the official. For example, if a vehicle made in Mexico is composed of 50% American parts and 50% foreign parts, the 25% tariff would be reduced to 12.5%.
Foreign leaders and automakers have criticized the tariffs. Japanese Prime Minister Shigeru Ishiba said his government was “putting all options on the table” in response, while the German Association of the Automotive Industry called the move “a disastrous signal for free, rules-based trade.”
Canadian Prime Minister Mark Carney called the tariffs a “direct attack” on Canadian workers and threatened retaliation.
The development comes as Washington continues to accuse the EU of unfair trade practices, including high tariffs on American goods and restrictive regulations that disadvantage US companies.
