New York, March 27 (HS): President Donald Trump announced a new 25 percent tariff on imported cars and trucks in the U.S. on Wednesday, effective April 3. This move is expected to raise the prices of vehicles, with nearly half of the cars sold in the U.S. being imported.

The primary goal of the tariff is to boost auto manufacturing capacity domestically. Previously, free trade agreements had kept automakers from Canada, Mexico, and the U.S. insulated from tariff issues. In his announcement, Trump remarked, Friends are often worse than enemies, highlighting his intent to impose these tariffs strictly on vehicles not produced in the U.S., while exempting American-made models.

The tariff will also extend to imported car parts, including engines and transmissions, set to go into effect before May 3. Following the announcement, shares of major automakers Stellantis, Ford, and General Motors dropped, with GM experiencing a decline of over seven percent. Industry analysts warn that this tariff could damage the manufacturing sector and lead to higher prices for American consumers, with predictions suggesting that out of 16 million vehicles expected to be sold in 2024, half will be imports.

Hindusthan Samachar / Jun Sarkar