Trump considers pausing his auto tariffs as the world economy endures
whiplash
[April 15, 2025] By
JOSH BOAK and MICHAEL LIEDTKE
WASHINGTON (AP) — President Donald Trump on Monday suggested that he
might temporarily exempt the auto industry from tariffs he previously
imposed on the sector, to give carmakers time to adjust their supply
chains.
“I’m looking at something to help some of the car companies with it,”
Trump told reporters gathered in the Oval Office. The Republican
president said automakers needed time to relocate production from
Canada, Mexico and other places, "And they need a little bit of time
because they’re going to make them here, but they need a little bit of
time. So I’m talking about things like that.”
Matt Blunt, president of American Automotive Policy Council, an
association representing Ford, General Motors and Stellantis, said the
group shared Trump's goals of increased domestic production.
“There is increasing awareness that broad tariffs on parts could
undermine our shared goal of building a thriving and growing American
auto industry, and that many of these supply chain transitions will take
time," Blunt said.
Trump's statement hinted at yet another round of reversals on tariffs as
Trump's onslaught of import taxes has panicked financial markets and
raised deep concerns from Wall Street economists about a possible
recession.
When Trump announced the 25% auto tariffs on March 27, he described them
as “permanent.” His hard lines on trade have become increasingly blurred
as he has sought to limit the possible economic and political blowback
from his policies.
Last week, after a bond market sell-off pushed up interest rates on U.S.
debt, Trump announced that for 90 days his broader tariffs against
dozens of countries would instead be set at a baseline 10% to give time
for negotiations.
At the same time, Trump increased the import taxes on China to 145%,
only to temporarily exempt electronics from some of those tariffs by
having those goods charged at a 20% rate.
“I don’t change my mind, but I’m flexible,” Trump said Monday.
Trump's flexibility has also fueled a sense of uncertainty and confusion
about his intentions and end goals. The S&P 500 stock index was up 0.8%
Monday, but it's still down nearly 8% this year. Interest rates on
10-year U.S. Treasury notes were elevated at roughly 4.4%.
Carl Tannenbaum, chief economist for the Northern Trust global financial
firm, said the whiplash had been so great that he might have to “get
fitted for a neck brace.”
Tannenbaum warned in an analysis: “Damage to consumer, business, and
market confidence may already be irreversible.”
Maroš Šefčovič, the European commissioner for trade and economic
security, posted on X on Monday that on behalf of the European Union he
engaged in trade negotiations with Commerce Secretary Howard Lutnick and
U.S. Trade Representative Jamieson Greer.
[to top of second column] |
President Donald Trump gestures to the crowd as he departs after
welcoming the 2025 College Football National Champions, the Ohio
State University football team, during an event on the South Lawn of
the White House, Monday, April 14, 2025, in Washington. (AP
Photo/Manuel Balce Ceneta)
 "The EU remains constructive and
ready for a fair deal — including reciprocity through our 0-for-0
tariff offer on industrial goods and the work on non-tariff
barriers," Šefčovič said.
The U.S. president also said that he spoke with Apple CEO Tim Cook
and “helped” him recently. Many Apple products, including its
popular iPhone, are assembled in China.
Apple didn’t respond to a Monday request for comment about the
latest swings in the Trump administration’s tariff pendulum.
Even if the exemptions granted on electronics last week turn out to
be short-lived, the temporary reprieve gives Apple some breathing
room to figure out ways to minimize the trade war’s impact on its
iPhone sales in the U.S.
That prospect helped lift Apple’s stock price 2% on Monday. Still,
the stock gave up some of its earlier 7% increase as investors
processed the possibility that the iPhone could still be jolted by
more tariffs on Chinese-made products in the weeks ahead.
Wedbush Securities analyst Dan Ives said Apple is clearly in a far
better position than it was a week ago, but he warned there's still
“mass uncertainty, chaos, and confusion about the next steps ahead.”
One possible workaround Apple may be examining during the current
tariff reprieve is how to shift even more of its iPhone production
from its longtime hubs in China to India, where it began expanding
its manufacturing while Trump waged a trade war during his first
term as president.
The Trump administration has suggested that its tariffs had isolated
China as the U.S. engaged in talks with other countries.
But China is also seeking to build tighter relationships in Asia
with nations stung by Trump's tariffs. China’s leader, Xi Jinping,
on Monday met in Hanoi with Vietnam's Communist Party General
Secretary To Lam with the message that no one wins in trade wars.
Asked about the meeting, Trump suggested the two nations were
conspiring to do economic harm to the U.S. by “trying to figure out
how do we screw the United States of America.”
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Liedtke reported from San Francisco.
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