Auto Parts Tariffs May Be Delayed as Trump Considers Limited Exemptions

Trump may delay parts tariffs to give automakers time to shift supply chains domestically.
S. auto firms say broad tariffs will raise costs, cause layoffs, and hurt competitiveness.
Stock markets reacted positively to Trump’s comments on potential relief for car manufacturers.

On April 14, U.S. President Donald Trump said he is exploring potential exemptions to a planned 25% tariff on imported automotive parts. He cited the need to give manufacturers time to relocate production to the United States.

In the Oval Office, Trump stated, “They’re switching to parts that were made in Canada, Mexico and other places, and they need a little bit of time, because they’re going to make them here.”

The announcement comes as U.S. automakers continue lobbying the administration to shield low-cost vehicle components from new import duties. Ford, General Motors, and Stellantis have indicated a willingness to pay tariffs on completed vehicles and significant assemblies like engines but argue that sweeping tariffs on smaller parts could increase production costs by billions of dollars, disrupt supply chains, and trigger layoffs.

Trump’s comments briefly lifted auto stocks, with GM, Ford and Stellantis shares rebounding from session lows following the remarks.

The White House has already implemented a 25% tariff on fully assembled vehicle imports, and tariffs on parts will take effect no later than May 3rd. Current trade rules under the North American agreement allow for exemptions if vehicles meet minimum domestic content thresholds.

Automakers have argued that the proposed parts duties contradict the administration’s stated goal of revitalizing U.S. manufacturing. Industry representatives have warned that higher input costs could force companies to reduce investment or issue profit warnings.

Source: Automotive News

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