03/30/2025 / By Laura Harris
President Donald Trump has imposed 25 percent new tariffs on all foreign-made cars and auto parts imported into the U.S. to strengthen domestic manufacturing and restore U.S. industrial independence.
In a press conference at the Oval Office on March 26, Trump announced that the new tariffs, set to take effect April 3 at 12:01 a.m. ET, target vehicles and components shipped from abroad, excluding those built domestically, to bolster U.S. auto production. The policy also imposes tariffs on critical parts like engines and transmissions, with those levies beginning by May 3.
“Frankly, friend has been oftentimes much worse than foe,” Trump said before signing the executive proclamation in the Oval Office that day. “What we’re going to be doing is a 25 percent tariff on all cars that are not made in the United States. If they’re made in the United States, it’s absolutely no tariff.” (Related: Trump grants one-month tariff exemption for auto imports from Mexico, Canada amid industry concerns.)
Moreover, Trump, who campaigned on lowering prices ahead of his 2024 re-election, insisted the tariffs would ultimately create jobs. “This is permanent,” he declared, criticizing what he called a “ridiculous” supply chain where parts and vehicles are manufactured across the U.S., Mexico and Canada. He even believes that this will generate $100 billion in annual revenue.
“This will continue to spur growth,” Trump said. “We’ll effectively be charging a 25 percent tariff.”
The tariffs apply to both finished vehicles and parts, with exemptions for U.S. content under the United States-Mexico-Canada Agreement (USMCA) trade agreement with Mexico and Canada. The move relies on a 2019 Commerce Department investigation that justified tariffs on national security grounds during the first Trump administration.
These auto tariffs are part of a broader plan to reshape global relations.
For instance, Trump slapped a 20 percent tariff on all Chinese imports due to China’s role in the production of fentanyl, a deadly opioid fueling America’s addiction crisis. Meanwhile, Canadian energy products face a lower 10 percent duty, though broader trade disputes remain unresolved.
He also reinstated and expanded his 2018 metals tariffs, imposing a 25 percent duty on all steel and aluminum imports, removing exemptions that had previously spared some allies. Now, Trump is eyeing additional levies on critical goods, including computer chips (25 percent), pharmaceutical drugs (25 percent) and lumber and copper (25 percent).
Additionally, Trump intends to impose 25 percent tariffs on countries that import oil from Venezuela, despite the U.S. itself being a buyer of Venezuelan crude. The policy appears to further isolate President Nicolás Maduro’s regime but risks complicating global energy markets.
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