Trump keeps 25% tariffs on US car imports in place

US President Donald Trump on Wednesday paused for 90 days many tariffs but is not halting 25% tariffs on automotive imports and looming tariffs on car parts, drawing criticism from Michigan business and auto groups.

The Detroit Regional Chamber and MichiganAuto called on Trump to protect the automotive industry's complex international supply chain framework from harmful fragmentation that weakens its global competitiveness.

“Michigan's signature industry and the supply chains and employees that sustain it will continue to endure the uncertainty and disruption of these fluctuating trade policies,” they said in a statement after last month warning the tariffs would result in significant pain for carworkers.

The groups noted that Trump was also leaving in place 25% tariffs on aluminium and steel that are also affecting carmakers.

Trump said on Wednesday he is considering granting some US companies an exemption from his tariff programme but it is unclear if he is considering carmakers.

“There are some that have been hit hard,” Trump told reporters when asked about companies requesting exemptions. “There are some that, by the nature of the company, get hit a little bit harder. We'll take a look at that.”

Michigan governor Gretchen Whitmer, a Democrat, on Wednesday in Washington called for exempting cars from tariffs.

“Let's carve out cars and energy, both of which are critical to manufacturers and directly impact people's wallets,” she said.

Earlier this week, a Detroit-area automotive advisory firm forecast US and Canada car sales could decline by 1.8-million vehicles this year and be stagnant over the next decade if the global trade war escalates,

Trump’s 25% automotive import tariffs went into effect on April 3. Vehicles made in Mexico and Canada face the levy, but carmakers compliant with the terms of the US-Mexico-Canada Agreement can deduct the value of US content.

New 25% tariffs on car parts are to take effect by May 3.

Chrysler-parent Stellantis said last week it is temporarily shutting down production at two plants in Mexico and in Canada, affecting five US facilities that are connected to them, including temporarily laying off 900 US workers.

Other carmakers are limiting some US vehicle imports to reduce the impact of the tariffs.