Automotive tariffs expected April

Beck Elandt | Staff Writer 

Tariffs announced in early February have been in effect since March 4, and further actions from the U.S. continue paving the road to change.

As of March 26, President Donald Trump signed an executive order placing a 25% tariff on all foreign auto-related imports, effective April 2. 

White House official Will Scharf announced, “we expect that these tariffs will result in over $100 billion of new annual revenue.” In addition to this, the White House claims this will support domestic manufacturing, bringing more “plants” to the U.S.

The Associated Press stated in an article the next day, that this could “put a financial squeeze on automakers that depend on global supply chains.”

Secretary of Treasury Scott Bessent has been a recent resource for the White House agenda, reporting to Fox Business News on March 18 about a new wave of tariffs anticipated for April 2.

“Each country will receive a number that we believe represents their tariffs. For some countries, it could be quite low. For some countries it could be quite high,” said Bessent about U.S. trading partners’ potential sabotage against the U.S.

According to Bessent, the White House plans to assess these countries for possible tariff levels, non-tariff barriers, currency manipulation, unfair funding and labor suppression. And, if an agreement is met, there will be no tariff wall. The White House said it aims to promote fairness between other countries, offering an opportunity for negotiable terms like Mexico and Canada.

From a business angle, leaders from the three largest U.S. automotive companies: Ford, General Motors and Stellantis (formerly Chrysler), came to an agreement with the president on March 5 (one day after the initial one-month postponement) to suspend tariffs for automotive manufacturers until April 1, if they comply with the terms of the USMCA (United States-Mexico-Canada Agreement).   

On March 6, Trump decided to allow all products traded under the USMCA agreement to be exempt from tariffs until April 2, resulting in a much smaller impact on trade and North American business, effectively alleviating the current impact tariffs would have on more economically crucial goods.

Later, on March 11, after Canada and Mexico levied reciprocal tariffs opposite to the ones set forth by the Trump administration, Ontario threatened to hike electricity imports to select states: Michigan, Minnesota and New York. In response, President Donald Trump threatened to “raise tariffs on Canadian steel and aluminum by an additional 25%,” according to CNBC.

Later that day, both parties backed down from their threats, returning to existing tariffs.

Economics professor Gregg Heidebrink, of WCC reminds us about the structure of tariffs. 

“Whoever is importing the good has to pay the tariff,” Heidebrink said. In the case of the U.S., the tariff on Canada means businesses and/or consumers must pay more for anything imported from Canada and, usually, it’s the consumer paying. 

Still, businesses could have a hard time staying above water amidst waves of economic imbalance.

“Businesses would like to have stability, both for long-term benefit and short-term profit,” Heidebrink said when asked about how frequent changes of policy would affect an economy. 

A clear example of this stems from the auto industry because it’s much cheaper to manufacture car parts in other countries and import the raw product to the U.S., except with high tariffs, it could be more affordable to make cars within the U.S., promoting jobs in the industry.

Regardless of where cars are produced, WCC’s auto-tech program works to train the future of the industry.

Rocky Roberts, Department co-chair of transportation tech, oversees many of the processes within the auto program. To avoid costs or tariffs, teaching opportunities are performed on used vehicles and parts are sourced second hand, or from businesses within the U.S.

“We train the hard skills, the technical skills,” Roberts said. After students earn an entry-level technician certificate, local dealerships (Ford, GM and Honda to name a few) become internship pathways, where students can learn hands-on how cars are put together in a safe and controlled environment, potentially leading to a manufacturing position. 

Roberts himself is very passionate about creating a high-functioning environment. “There’s lots of opportunity,” he said.

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