US slaps 25% tariff on car imports

Duties seen driving up prices, slowing output

- NANDITA BOSE DAVID LAWDER LEIKA KIHARA

Asian auto stocks fell yesterday after US President Donald Trump unveiled a 25% tariff on imported vehicles, expanding a global trade war and prompting criticism and threats of retaliation from affected US allies.

The new levies on cars and light trucks will take effect on April 3, the day after Trump plans to announce equipped tariffs aimed at the countries responsible for the bulk of the US trade deficit. They come on top of duties already introduced on steel and aluminium, and on goods from Mexico, Canada and China.

The US imported $474 billion worth of automotive products in 2024, including passenger cars worth $220 billion. Mexico, Japan, South Korea, Canada and Germany, all close US allies, were the biggest suppliers.

European Commission President Ursula von der Leyen described the move as “bad for businesses, worse for consumers,” while Canadian Prime Minister Mark Carney about the American “direct attack” on Canadian workers and said retaliatory measures were being considered.

“We will defend our workers, we will defend our communities, we will defend our country, and we will defend it together,” Mr Carney told reporters in Ottawa.

Automakers such as Toyota Motor and Mazda Motor led declines in stocks in Japan, which relies on autos for more than a quarter of its exports to the US. Shares of automakers in South Korea, Hyundai Motor and Kia Corp, fell sharply.