\n<\/p>\n
President Donald Trump has delayed tariffs on automobile imports from Canada and Mexico for one month after requests from executives at the Big Three automakers \u2014 General Motors, Ford, and Stellantis \u2014 with the expectation that automakers will move any offshore operations to the United States by April 2.<\/p>\n
The reprieve, which Politico<\/a> first reported, comes less than two days after Trump issued 25% tariffs on all goods from the U.S.\u2019s neighbors, which had previously been duty-free under a North American trade agreement<\/a> (sometimes characterized as NAFTA 2.0) negotiated during his first term. The exemption applies to automakers that comply with the USMCA, per The Wall Street Journal<\/a>.<\/p>\n Several automakers, including the Big Three, have complex supply chains and operate several manufacturing facilities in Mexico and Canada. For example, GM produces its Chevy Equinox in Mexico and Canada, and both Ford\u2019s Lincoln Nautilus SUVs and Stellantis\u2019 Dodge Chargers are made in Ontario. Multiple automotive suppliers also have factories in the two countries.<\/p>\n Car prices are already at historic highs, and the tariffs threaten to send sticker prices skyrocketing by as much as $12,000, according<\/a> to Jeff Schott, senior fellow at the Peterson Institute for International Economics, who was interviewed by the Detroit Free Press. That could lead to less demand, leaving dealers stuck with unaffordable cars on their lots.<\/p>\n In an address to Congress on Tuesday, Trump urged manufacturers to move their operations onshore. White House press secretary Karoline Leavitt said in a briefing<\/a> Wednesday that Trump expects GM, Ford, and Stellantis to shift production to the U.S. before the tariffs kick off at the end of the month. <\/p>\n \u201cHe told them that they should get on it,\u201d Leavitt said. <\/p>\n Ford CEO Jim Farley said last month at an investor talk the company doesn\u2019t have excess capacity at its plants to shift production. Farley noted that Ford could withstand tariffs in the short term, but if they persisted, they \u201cwould blow a hole in the U.S. industry that we\u2019ve never seen.\u201d<\/p>\n Through February, nearly half of all new vehicles sold in the U.S. were built in the U.S., but 17.4% of them were built in Mexico, and 7.4% in Canada, according to data from Edmunds.com. <\/p>\n \u201cSince President Trump\u2019s successful USMCA was signed, Ford has invested billions in the United States and committed to billions more in the future to both invest in American workers and ensure all of our vehicles comply with USMCA,\u201d reads a statement<\/a> from Ford. \u201cWe will continue to have a healthy and candid dialogue with the Administration to help achieve a bright future for our industry and U.S. manufacturing.\u201d<\/p>\n