In the harshest of terms, President Donald Trump said he “couldn’t care less” is car prices rise due to the 25 percent tariffs his administration is set to put into effect this week.
In a phone interview with Meet the Press anchor Kristen Welker that aired on March 30, President Trump asserted that he was not backing down on his tariff plan that has raised the concerns of automakers, economists and dealers alike.
“What we’re going to be doing is a 25 percent tariff on all cars that are not made in the United States,” the Presidemnt said. “If they are made in the United States, there’s absolutely no tariff.”
“I Couldn’t Care Less If They Raise Prices”
President Trump reiterated that the 25 percent tariff were “absolutely permanent” and dismissed concerns from foreign automakers and dealers about the cost of a car going up.
“I couldn’t care less if they raise prices, because people are going to start buying American-made cars,” President Trump told Welker. After the interview, an aide to the president followed emphasized Trump was referring specifically to foreign car prices.
25% Tariffs
The Meet the Press statements come just days after an Oval Office signing ceremony for the tariffs that administration officials said are being imposed to force automakers to build plants and produce cars domestically. The President has previously stated the tariffs are needed to stop the flow of fentanyl and immigrants into the U.S. as well as to help bring manufacturing jobs back to the states.
According to a White House fact sheet, the 25 percent tariff will be applied to imported passenger vehicles (sedans, SUVs, crossovers, minivans, cargo vans) and light trucks, as well as key automobile parts (engines, transmissions, powertrain parts, and electrical components), with processes to expand tariffs on additional parts if necessary.
Trump had twice delayed the tariffs from taking effect—the first time to allow the Mexican and Canadian governments to respond and the second at the request of U.S. automakers so they were not at an “economic disadvantage.”
USMCA Battle
Importers of automobiles under the United States-Mexico-Canada Agreement (USMCA) will be given the opportunity to certify their U.S. content and systems will be implemented such that the 25 percent tariff will only apply to the value of their non-U.S. content.
Mexico is the top foreign supplier of cars to the U.S., followed by South Korea, Japan, Canada and Germany. The auto industry is deeply integrated between the countries that make up the USMCA trade agreement—Mexico imports 49.4 percent of all auto parts from the U.S. and exports 86.9 percent of its auto parts production to the U.S.
Many U.S. car companies have operations in Mexico and Canada as well, set up under the terms of the longstanding free trade agreement between the three countries.
The Effect of Tariffs
Analysis have estimated the 25 percent duty on a $25,000 vehicle from Canada or Mexico would add $6,250 to its cost, most of that expected to be pushed on the consumer. Wells Fargo estimates the tariffs would cost the Detroit Big 3 automaker billions of dollars a year. The firm estimated the impact the 25 percent tariffs on General Motors, Ford and Stellantis would collectively be $56 billion.
President Trump denied a Wall Street Journal report to Welker that he warned automaker of passing on tariff costs to car buyers by raising prices.
“No, I never said that,’ said Trump. “The message is congratulations, if you make your car in the United States, you’re going to make a lot of money. If you don’t, you’re going to have to probably come to the United States, because if you make your car in the United States, there is no tariff.”
