President Donald Trump announced Wednesday his decision to implement a 25% tariff on imported cars, effective April 2.
This tariff will affect both finished cars and trucks entering the United States, including those of American brands assembled abroad. Under the authority granted by Section 232 of the Trade Expansion Act of 1962, President Trump is imposing a 25% tariff on imports such as passenger vehicles—including sedans, SUVs, crossovers, and light trucks—and essential automobile parts like engines, transmissions, and electrical components. This measure aims to adjust imports for the sake of national security.
.@POTUS: “If parts are made in America and a car isn’t, those parts are not going to be taxed or tariffed and we will have very strong policing… It’s one number and that number is going to be used to reduce debt greatly in the United States and build things.” pic.twitter.com/xyA4m58mZ9
— Rapid Response 47 (@RapidResponse47) March 26, 2025
“If parts are made in America and a car isn’t, those parts are not going to be taxed or tariffed and we will have very strong policing,” Trump said. “It’s one number, and that number is going to be used to reduce debt greatly in the United States and build things.”
Trump said earlier in March that he plans to significantly raise the tariffs on cars imported into the U.S. and pointed out that these cars could readily be produced in the U.S. instead.
“I will substantially increase, on April 2nd, the Tariffs on Cars coming into the U.S. which will, essentially, permanently shut down the automobile manufacturing business in Canada. Those cars can easily be made in the USA!” Trump wrote.
In 1985, U.S.-owned and operated plants produced the vast majority of vehicles domestically. By 2024, the landscape had shifted dramatically, with Americans purchasing around 16 million vehicles, half of which were imports and only 40% to 50% of the domestically assembled vehicles were manufactured by American companies. That means that merely 25% of the vehicle content in the cars bought in the U.S. was actually “Made in America.”
The country faced a substantial trade deficit in automobile parts last year, amounting to $93.5 billion. This figure is part of a larger trend where imports across various categories, including automotive vehicles, parts, and engines, saw an increase of $16.1 billion.
The auto industry continues to be a huge employer in the U.S., with approximately one million Americans working across the sector. Auto parts manufacturing employs about 553,300 individuals. However, this sector has experienced a decline, losing about 286,000 jobs since the year 2000, which represents a 34% decrease in employment in auto parts manufacturing over the past decades.
(Featured Image Media Credit: Screenshot/Fox News/”Hannity”)
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