- President Donald Trump is considering slapping tariffs on imported cars and trucks.
- Some countries would stand to lose a lot from a tariff on vehicles.
- The biggest losers from a auto tariff would all be US allies: Mexico, Canada, Japan, Germany, and South Korea.
The newest target in President Donald Trump’s ongoing trade fight is imported cars and trucks. That already has some of the US’s closest allies a bit nervous.
Trump said Wednesday that the Commerce Department is investigating possible trade actions on imported vehicles and the administration is reportedly mulling a 25% tariff, or tax on imports, for the cars.
The move was widely condemned by US trade allies. Trade experts say Trump could be pushing the US into a trade war. But, it’s likely that some trade partners are more worried than others.
Looking at the US Census Bureau’s data for the import of cars and trucks used for the transport of people and goods, Business Insider ranked the countries that could get hit hardest by Trump’s move. Almost all of the top 10 currently maintain relatively close trade ties with America.
Unsurprisingly, the top two sources of imported vehicles are the other members of the North American Free Trade Agreement, or NAFTA: Mexico and Canada. Canada sends the most people-moving vehicles to the US, while Mexico sends the most goods-moving vehicles.
Trade analysts surmised that the tariff announcement may actually Trump’s attempt to pressure these two countries in the NAFTA renegotiation.
One of the biggest sticking points in the talks is the treatment of cars moving between the countries. The US wants to tighten rules, while Mexico and Canada want to keep the rules closer to the current system.
Trump appeared to link the impending action with the NAFTA negotiations prior to the formal announcement while speaking to reporters on Wednesday.
“I think your autoworkers and your auto companies in this country are going to be very happy with what’s going to happen. You’ll be seeing very soon what I’m talking about,” Trump said. “NAFTA is very difficult. Mexico has been very difficult to deal with. Canada has been very difficult to deal with.”
Following the NAFTA nations are Japan, Germany, and South Korea. Officials from all three countries have expressed concern about the potential tariffs. The move is perhaps less surprising given the president’s decades-long problems with Japanese imports to the US and recent comments blasting the European Union for their auto restrictions.
The Trump administration must still conduct a weeks-long investigation into auto imports before imposing any sanctions.
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