The administration of US President Donald Trump is considering whether to reduce certain tariffs targeting the auto industry that automaker executives have warned would deal a severe blow to profits and jobs.
One measure would spare automobiles and parts already subject to tariffs from facing additional duties from levies on steel and aluminum imports, people familiar with the matter said.
That would eliminate so-called “stacking” of levies.
Photo: Reuters
Another option being studied would fully exempt auto parts that comply with the US-Mexico-Canada trade pact (USMCA), some of the people said.
Those components do not currently face tariffs, but the administration had planned to tax the non-US share of those parts from Canada and Mexico. Fully sparing those parts would abandon that approach, which would present a potentially herculean logistical challenge.
The Financial Times reported that the Trump administration is considering reducing tariffs on auto parts — and that it might also exempt auto parts bought from China from a 20 percent tariff applied to the nation over a dispute over fentanyl.
The proposals and options remain under consideration, and Trump has not signed off, said the people, who asked not to be identified discussing the matter, because it is not public.
Trump’s tariff policies often change quickly, underscoring the fluidity of policy deliberations, but the discussions offer a signal that the administration is considering ways to narrow the scope of levies affecting the auto industry.
If adopted, the changes would be a significant reprieve for automakers, who have warned of devastating consequences from the tariffs, including higher vehicle prices, production cuts and potential job losses. The industry relies on deeply integrated supply chains spanning North America for the vehicles they sell in the US.
Trump has separately applied tariffs on goods from Canada and Mexico, although exempted USMCA-compliant goods.
The tariffs on autos and auto parts were poised to heavily disrupt the integrated continental supply chain. The US plan, as initially announced, offered something of an olive branch by applying tariffs only on the non-US share of USMCA-traded vehicles, and delaying a potential tariff on parts traded under the pact.
The White House did not respond to a request for comment on Wednesday night.
Asked if he was considering changes to auto tariffs, Trump on Wednesday indicated he was not, while also suggesting he might even increase levies on the Canadian auto sector.
“No, we’re not considering it now, but at some point it could go up,” Trump said. “Because, again, we don’t really want Canada to make cars for us. To put it bluntly, we want to make our own cars, and we’re now equipped to do that.”
Detroit’s automakers for weeks have lobbied the administration to exclude certain low-cost car components from planned tariffs.
Company representatives have told the administration that broad parts duties would drive up costs, and trigger profit warnings and layoffs that would counter Trump’s goal of rebuilding US manufacturing.
Trump plans to travel to Michigan next week.
Automakers are expected to shoulder much of the tariff burden, at least initially, with margins at many parts manufacturers already running thin.
The domestic unit of the Chinese-owned, Dutch-headquartered chipmaker Nexperia BV will soon be able to produce semiconductors locally within China, according to two company sources. Nexperia is at the center of a global tug-of-war over critical semiconductor technology, with a Dutch court in February ordering a probe into alleged mismanagement at the company. The geopolitical tussle has disrupted supply chains, with some carmakers reportedly forced to cut production due to chip shortages. Local production would allow Nexperia’s domestic arm, Nexperia Semiconductors (China) Ltd (安世半導體中國), to bypass restrictions in place since October on the supply of silicon wafers — etched with tiny components to
Singapore-based ride-hailing and delivery giant Grab Holdings Ltd has applied for regulatory approval to acquire the Taiwan operations of Germany-based Delivery Hero SE's Foodpanda in a deal valued at about US$600 million. Grab submitted the filing to the Fair Trade Commission on Friday last week, with the transaction subject to regulatory review and approval, the company said in a statement yesterday. Its independent governance structure would help foster a healthy and competitive market in Taiwan if the deal is approved, Grab said. Grab, which is listed on the NASDAQ, said in the filing that US-based Uber Technologies Inc holds about 13 percent of
Taiwan is open to joining a global liquefied natural gas (LNG) program if one is created, but on the condition that countries provide delivery even in a scenario where there is a conflict with China, an energy department official said yesterday. While Taiwan’s priority is to have enough LNG at home, the nation is open to exploring potential strategic reserves in other countries such as Japan or South Korea, Energy Administration Deputy Director-General Chen Chung-hsien (陳崇憲) said. While the LNG market does not have a global reserve for emergencies like that of oil, the concept has been raised a few times —
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday received government approval to deploy its advanced 3-nanometer (3nm) process at its second fab currently under construction in Japan, the Ministry of Economic Affairs said in a news release. The ministry green-lit the plan for the facility in Kumamoto, which is scheduled to start installing equipment and come online in 2028 with a monthly production capacity of 15,000 12-inch wafers, the ministry said. The Department of Investment Review in June 2024 authorized a US$5.26 billion investment for the facility, slated to manufacture 6- to 12nm chips, significantly less advanced than 3nm process. At a meeting with
RSS