“This is the beginning of liberation day in America,” President Donald Trump declared on Wednesday as he announced that he will be imposing a 25 percent tariff on all cars imported into the United States. This measure is aimed at reducing the U.S. trade imbalance and revitalizing domestic manufacturing.
“What we’re going to be doing is a 25 percent tariff on all cars not made in the U.S.,” Trump explained, noting that the tariffs are expected to take effect on April 2 and will apply to all finished cars and trucks shipped into the United States. This measure includes American brands that are manufactured overseas.
“Anybody who has plants in the United States, it’s going to be good for,” Trump continued, referring to the initiative as “very exciting.”
Newsmax reports:
The tariffs, which the White House expects to raise $100 billion in revenue annually, could be complicated as even U.S. automakers source their components from around the world. The tax hike starting in April means automakers could face higher costs and lower sales, though Trump is adamant that the tariffs will lead to more factories opening in the United States and the end of what he judges to be a “ridiculous” supply chain in which auto parts and finished vehicles are manufactured across the United States, Canada and Mexico.
To underscore his seriousness, Trump said, “This is permanent.”
🚨BREAKING: Trump just announced a 25% tariff on all foreign made vehicles!
Why do you think these auto manufacturers have been making mad dashes back to America?
AMERICA FIRST!
pic.twitter.com/hTP83cQJWH— Gunther Eagleman™ (@GuntherEagleman) March 26, 2025
Shares in General Motors fell roughly 3% in Wednesday trading. Ford’s stock was up slightly. Shares in Stellantis, the owner of Jeep and Chrysler, dropped nearly 3.6%.
Trump has long said that tariffs against auto imports would be a defining policy of his presidency, betting that the costs created by the taxes would cause more production to relocate to the United States while helping to narrow the budget deficit. But U.S. and foreign automakers have plants around the world to accommodate global sales while also maintaining competitive prices — and some critics contend it could take years for companies to design, build and open the new factories that Trump is promising.
Economist Mary Lovely predicted that we will be “looking at much higher vehicle prices” as well as “reduced choice.” She warned that “these kinds of taxes fall more heavily on the middle and working class.’’