President Donald Trump has announced a 25 percent tariff on cars and auto parts made in other countries. The tariff would take effect on April 2, and the United States would start collecting it the following day.
An inflow of $600 billion to $1 trillion investment in the United States within a year would be triggered, said Trump, adding that the new tariff would be “permanent.”
The increased duty would generate an estimated $100 billion in new annual tariff revenue, said a White House official, who added that the 25 percent auto tariff is cumulative to other tariffs already in place.
Trump further alluded to plans to give income tax deductions on the interest payment of a car loan if the car is made in America.
What about the automakers producing parts and assembling cars in North America? Trade organizations have estimated that auto parts may cross borders as many as eight times before final assembly.
A senior White House official clarified that only the foreign parts would be subject to the tariff. If a car has 50 percent of its parts made outside America, then duties will only be collected on foreign parts when the vehicle crosses the border.
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Trump said he had discussed the new auto tariff with the three major automakers—Stellantis, Ford, and General Motors.
Speaking of their reactions, he added: “It depends on whether or not they have factories here. I can tell you, if they have factories here, they’re thrilled. “If you don’t have factories here, they’re gonna have to get going and build them because otherwise, they have to pay tariffs. Very simple.”
Earlier this month, automakers obtained a one-month reprieve from tariffs on Canadian and Mexican goods. The White House also told them that another auto tariff was coming, and the temporary exemption wouldn’t shelter them from the impending sectoral duties.
A month is hardly enough time to reorganize a company’s supply chain—that’s the typical response from experts.
However, a month is enough to develop a credible plan to increase domestic manufacturing, said William Lee, chief economist at the Milken Institute, a California-based economic think tank.
He also said that automakers could negotiate to pay a tariff on net cross-border transactions that result from multiple imports and exports, or get extended or permanent tariff relief if they expand domestic production. It looks like the automakers have already worked out the first item.
According to him, increasing domestic manufacturing is the primary objective of the White House’s imposing tariffs on cars.
Lee sees tariffs as a component of Trump’s three-pronged plan to grow the U.S. economy.
“Reduce the size of government, therefore lower taxes,” he told The Epoch Times, adding that the first component also helps move labor into the private sector.
“No. 2, reduce regulation and use tariffs as an incentive to produce in the U.S. instead of abroad,” he said.
“At the same time, protect domestic producers,” Lee said about the use of tariffs in leveling the playing field by increasing the prices of foreign goods.
Lee took the Epoch Times’ interview days before Trump’s announcement. Trump’s remarks on Wednesday echoed Lee’s points.
“I view it [new auto tariff] as reducing taxes and also reducing debt,” the president said. “And within a fairly short period of time, I think we’re going to have a balance sheet that’s going to be outstanding.”
The current administration is resolute in making the U.S. supply chains self-sufficient.
“One of the things we’ve learned from the COVID-19 pandemic was that it exposed critical vulnerabilities and choke points in global supply chains, and this has undermined our ability to maintain a resilient domestic industrial base,” the senior White House official told reporters.
He said the United States had “become an assembly operation for autos.” “If you’re going to have a strong manufacturing and defense industrial base, you can’t just assemble parts.”
Yao-Yuan Yeh, professor of international studies at the University of St. Thomas in Houston, told The Epoch Times that the auto sector had arranged its supply chain to take advantage of cheaper resources in other countries over the years.
Such supply chain arrangements have led cars and parts to contribute nearly a quarter of the total U.S. trade deficit last year.
In Yeh’s view, Trump’s end game with tariffs is to give the United States a more advantageous position in the world and make America more self-sufficient. Given the limit of four years, he said it is more realistic for Trump to set the direction and build momentum.
A 25 percent tariff provides a huge incentive to take the supply chain home.
—Terri Wu
PA Democrats Weigh In on the State of the Party
The Democratic Party appears to be in a state of flux following President Donald Trump’s victory last November, coupled with Republicans retaking control of the Senate and retaining a grip on the House of Representatives.
Recent polls by CNN and NBC respectively have the party at 29 and 27 percent favorability, while politicos and pundits weigh in on which member of the party will emerge to right the ship and steer the Democrats into election wins in 2026 and beyond.
As the elected leaders of the Democrats work to realign themselves and strategize for the 2026 midterm elections, The Epoch Times spoke to voters ahead of a crucial election in Pennsylvania’s District 35 to find out what changes they wanted to see in the party.
Laura Leone, a resident in McKeesport borough just outside of Pittsburgh, had traveled neighboring Homestead to hand out flyers for Democrat Dan Goughnour ahead of a special election in District 35.
Goughnour would go on to collect a comfortable 63 percent majority ahead of GOP challenger Chuck Davis and Libertarian Adam KItta in a contest to replace Democrat Matthew Gergely, who died in January.
The race was high-stakes for Pennsylvania, as the legislature was evenly divided 101 to 101 between the GOP and the Democrats; Goughnour’s win lets the Democrats keep the narrowest edge.
Leone was confident that Goughnour would be an able leader, but said she’s somewhat overwhelmed by the current state of national politics, and the “extremists on both sides.”
“I don’t even know what to think,” she told The Epoch Times.
“But hopefully, as time passes, we can move on and we can come together and see eye to eye on certain issues that are really important.”
Infighting among the Blue Team has emerged, especially after Sen. Minority Leader Chuck Schumer (D-N.Y) voted to advance a GOP-led spending bill mid-March, rather than allow a government shutdown.
Schumer did not like the bill, but said a shutdown would have been far worse. His choice resulted in criticism from his own party members, including an awkward moment where House Minority Leader Hakeem Jeffries (D-N.Y.) refused to answer a question about whether Schumer should remain in charge of Senate Democrats.
Dane, a 53-year-old counselor, thinks new leadership might bring better results.
“I think we need some new blood … more in the lines of an AOC [Rep. Alexandria Occasio-Cortez (D-N.Y.) kind of person, I think maybe a bit more moderated than she is,” he told The Epoch Times.
He also said he was concerned she might not have the necessary mass-appeal.
The ideological divide between Republicans and Democrats in this region seems narrow: Residents said they were motivated by tangible, on-the-ground issues— especially the economy and crime—rather than scoring points against “the other side.”
George Harchar, retired veteran and welder, told The Epoch Times that at the local level he tends to favor the Democrats’ social safety net approach, and the slate of services they offer senior citizens.
But at the national level he often votes Republican, though he wishes the Trump administration’s methods showed more finesse.
“I like what they’re trying to do, but I don’t always agree with exactly the way they’re doing it,” he said.
Harchar has largely voted for Democrats in the past, including Gov. Josh Shapiro, but he thinks the party has lost its way.
“They’re all messed up right now … they support things that I just can’t support. I have daughters, I have granddaughters. I can’t support men playing in women’s sports,” Harchar said.
—Stacy Robinson
BOOKMARKS
It appears the government didn’t quite release all the info related to the assassination of President John F. Kennedy, even though conspiracy-hunters received a glut of 80,000 documents related to the case last week. The Epoch Times’ Travis Gilmore went hunting through the National Archives, and found boxes of still-redacted, undigitized documents.
The Congressional Budget Office (CBO) announced on Wednesday that the United States is in danger of defaulting on its financial obligations, possibly by as early as May, unless the debt ceiling is raised. The debt ceiling, a limit on how much money the government can borrow, had been suspended since June 2023, but kicked in again on Jan. 2 of this year.
The U.S. Department of Homeland Security (DHS) is pausing some green card applications, pending further review. Officials say the pause is to allow for further vetting of applicants, especially in light of President Donald Trump’s designation of certain cartels and gangs as foreign terrorist organizations.
The Supreme Court on Wednesday voted 7–2 to uphold regulations on “ghost guns,” which can be assembled at home and lack serial numbers. The regulations, instituted under former President Joe Biden, require background checks for those purchasing gun-assembly kits, and imposition of serial numbers on the newly-assembled guns.
As part of an ongoing purge of China’s military, Gen. He Weidong, the third-in-command of the People’s Liberation Army (PLA), has been arrested along with several other top brass. The arrests are still unexplained, but may be part of a decade-long anti-corruption campaign by Chinese Communist Party (CCP) leader Xi Jinping, or a plot to undermine him by his political enemies.
The U.S. Court of Appeals for the D.C. Circuit has upheld a lower-court block on Trump’s use of the Alien Enemies Act to deport suspected members of a Venezuelan gang. The decision was split 2-1, with one judge warning that lifting the block “risks exiling plaintiffs to a land that is not their country of origin.”
—Stacy Robinson
