POLITICO Energy How Trump’s auto tariffs could disrupt the economy
Mar 31, 2025
Doug Palmer, a senior trade reporter for POLITICO, joins to discuss President Trump's controversial 25% tariff on imported autos. He explains how this bold move aims to support U.S. manufacturers but might wreak havoc on the auto industry and the global economy. Palmer also highlights implications for national security and strained relations with allies, while touching on the SEC's recent decision to withdraw from climate risk disclosure regulations. Tune in for a deep dive into the future of trade amid shifting policies!
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Auto Tariff Details and Justification
- A 25% tariff on imported cars and parts will be added, increasing current tariffs to 27.5% for cars and 50% for trucks.
- The Biden administration justifies this as essential for national security, ensuring a robust domestic auto industry for potential wartime needs.
Domestic Impact of Tariffs
- Economists predict tariffs will be counterproductive, and automakers urge caution due to reliance on imported parts.
- Increased costs from tariffs on parts, especially from Mexico and Canada, are a major concern.
Global Impact and Ally Reactions
- Allies like the EU, Canada, Mexico, Japan, and South Korea are concerned about reduced market access due to tariffs.
- They may retaliate or restrict US market access in response.