Note: This story was updated at 12 p.m. EST on March 6.
On Tuesday, delayed 25% tariffs took effect on Mexico and Canada. After a call with auto executives, the White House delayed tariffs on vehicles another month. And on Thursday, President Donald Trump again delayed tariffs on many goods from Mexico.
Earlier on Thursday, Trump and Mexican President Claudia Sheinbaum had what Sheinbaum called "an excellent and respectful call in which we agreed that our work and collaboration have yielded unprecedented results."
On his social media platform, Truth Social, Trump lauded his relationship with Sheinbaum.
"I did this as an accommodate, and out of respect for, President Sheinbaum. Our relationship has been a very good one, and we are working hard, together, on the Border, both in terms of stopping illegal Aliens from entering the United States and, likewise, stopping Fentanyl," the president wrote.
Original story follows:
The White House issued a 30-day exemption for automakers Wednesday on 25% tariffs on goods imported to the U.S. from Canada and Mexico and a 10% tariff on Canadian energy products. It is not immediately clear if the pause applies to vehicles or parts, which may cross the border multiple times during the production process, or both. It’s also unclear if the pause covers commercial vehicles as well as passenger cars.
“Conversations held today indicate positive results that USMCA-compliant parts are included, but we are awaiting official confirmation from the administration. Clarity on trade policy remains essential to ensuring supply chain stability and investment confidence,” says Bill Long, president and CEO of MEMA, The Vehicle Suppliers Association. “We appreciate the White House’s decision to provide additional time to work together on solutions that align with the administrations manufacturing and growth objectives while recognizing the complexity of the North American auto manufacturing ecosystem.”
The one-month delay applies to manufacturers who comply with the United States-Mexico-Canada Agreement, or USMCA, a trade agreement negotiated by President Donald Trump during his first term in office. The agreement specifies, among other things:
- 70% of a manufacturer’s steel and aluminum purchases must originate in North America.
- 75% of passenger car components and 70% of heavy truck components must come from North America.
About half of U.S. Class 8 trucks are produced in Mexico. S&P Global says commercial vehicle suppliers have little or no ability to absorb the 25% tariff increases.
“At the request of the companies associated with USMCA, the president is giving them an exemption for one month so they are not at an economic disadvantage,” White House Press Secretary Karoline Leavitt says. She added Trump is open to other exemptions.
[RELATED: TPS readers weigh in on Trump tariffs]
The pause comes a day after executives from General Motors, Ford and Stellantis, spoke with Trump as the tariffs went into effect. On the call were Mary T. Barr, CEO of General Motors; John Elkann, chairman of Stellantis; William C. Ford, chairman of Ford Motor; and Jim Farley, Ford’s CEO.
“We continue to believe vehicles and parts that meet the USMCA’s stringent domestic and regional content requirements should be exempt from the tariff increase,” says American Automotive Policy Council President Matt Blunt. “Our American automakers, who invested billions in the U.S. to meet these requirements, should not have their competitiveness undermined by tariffs that will raise the cost of building vehicles in the United States and stymie investment in the American workforce, while our competitors from outside of North America benefit from easy access to our home market.”
A new wave of tariffs is set to start April 2, including on auto imports, as Trump targets countries that have placed duties on American goods. During an address to a joint session of Congress on Tuesday, Trump said tariffs will cause “a little disturbance, but we’re OK with that.” About the auto industry, specifically, he says tariffs will bring a boom in the American production.
[RELATED: Market uncertainty seen in falling February truck orders]
“By the way, we’re going to have growth in the auto industry like nobody’s ever seen — plants are opening up all over the place, deals are being made — never seen,” Trump told Congress. “That’s a combination of the election win and tariffs. It’s a beautiful word, isn’t it? That, along with our other policies will allow our auto industry to absolutely boom.”
On Tuesday, executives with the Big Three had a call with Trump, encouraging exemptions of the tariffs. Leavitt says Trump told the companies to “start moving, shift production here to the United States of America, where they will pay no tariffs.”
