U.S. President Donald Trump signed a pair of orders to soften the blow of his auto tariffs on Tuesday with a mix of credits and relief from other levies on materials, and his trade team touted its first deal with a foreign trading partner, developments that eased investor worries about Trump's erratic trade policies.
The change comes the day Trump arrived in Michigan, cradle of the U.S. auto industry, and just days before a fresh set of 25% import taxes was set to kick in on automotive components. The trip, on the eve of his 100th day in office, comes as Americans take an increasingly dim view of Trump's economic stewardship, with indications his tariffs will weigh on growth and could drive up inflation and unemployment. In his latest partial reversal of tariff policies, the Republican president agreed to provide carmakers with credits for up to 15% of the value of vehicles assembled domestically. These could be applied against the value of imported parts, allowing time to bring supply chains back home.
Auto industry leaders had lobbied the administration furiously during the weeks since Trump first unveiled his 25% tariffs on imported vehicles and auto parts. The levies, aimed at forcing automakers to reshore manufacturing domestically, had threatened to scramble a North American automotive production network integrated across the U.S., Canada and Mexico. It offers the industry a "little relief" as companies invest in more U.S. production, Trump said as he left Washington for Michigan. "We just wanted to help them. ... If they can't get parts, we didn't want to penalize them."
With your current subscription plan you can comment on stories. However, before writing your first comment, please create a display name in the Profile section of your subscriber account page.