Washington: Asian auto stocks tumbled after US President Donald Trump announced a 25 percent tariff on imported vehicles. The new tariffs, set to take effect on April 3, come on top of existing levies on steel, aluminum, and goods from Mexico, Canada, and China. Trump also plans to announce reciprocal tariffs targeting nations with large trade surpluses with the US.
In 2024, the US imported $474 billion worth of automotive products, including $220 billion in passenger cars. The biggest suppliers like Mexico, Japan, South Korea, Canada, and Germany, now face severe economic repercussions.
European Commission President Ursula von der Leyen called the tariffs “bad for businesses, worse for consumers,” while Canadian Prime Minister Mark Carney condemned them as a “direct attack” on Canadian workers, vowing potential retaliatory measures.
Japanese Prime Minister Shigeru Ishiba stated that Tokyo would explore “all options” in response, while South Korea announced an emergency plan to mitigate the impact on its auto industry.
Brazil’s President Luiz Inácio Lula da Silva warned that protectionist policies could harm the US economy and pledged to file a complaint with the World Trade Organization over a levy on Brazilian steel.
The United Auto Workers (UAW), a longtime critic of free trade agreements, welcomed the tariffs. Industry analysts warn that the tariffs could raise car prices, reduce vehicle sales, and lead to job losses.
Trump defended his decision, calling it a necessary move to reclaim American wealth. The president also threatened higher tariffs against the EU and Canada if they retaliated.
