President Trump said on Wednesday that he would pause the rates for cars that enter the United States from Canada and Mexico for a month, after a rate of 25 percent that he placed the best trading partners in America the day earlier and was earlier on bodemmarkten and led to a stiff resistance of the industry.
Karoline Leavitt, the press secretary of the White House, read a statement from Mr Trump on Wednesday and said that the White House had spoken with the three largest car manufacturers and that an exemption of a month would be given to cars that arrive through the United States-Mexico-Canada agreement.
“At the request of the companies associated with USMCA, the president gives them a month of exemption, so that they are not in an economic disadvantage,” said the statement. The three car manufacturers with whom Mr Trump spoke were General Motors, Ford Motor and Stellantis.
Asked why Mr Trump only granted a one -month delay, Mrs. Leavitt said that the president expected the car manufacturers to move production back to the United States. The message, she said, was to “step, start investing, start moving, moving production here to the United States of America, where they will not pay rates.”
The delay was a demonstration of the random approach that Mr Trump has chosen for trade policy, in which the president announced, pauses and then continued with a policy that is very influential for the North -American economy within a few weeks. The decision came after Mr Trump had organized a conference interviews on Tuesday with Mary T. Barra, the Chief Executive of General Motors; John Elkann, the chairman of Stellantis; William C. Ford, the chairman of Ford Motor; And Jim Farley, the Chief Executive of Ford, according to a person who has been informed about the call.
The managers said the president that placing rates on cars and parts from Canada and Mexico would effectively erase the profit of their companies by imposing billions of dollars in new costs, the person said. They claimed that cars built in those countries supported jobs in the United States in parts factories, dealers and other related companies.
They said they had invested in factories in North America because they were insured by Nafta and the USMCA, the trade agreement that Mr Trump negotiated with Canada and Mexico in his first term, that the continent would be a free trade zone, the person said. The abrupt change of the rules of that zone would have devastating consequences.
Managers of the three companies said they would not object to the rates imposed on cars imported from outside North -America, the person said. Apart from Canada and Mexico, the United States imports a large number of cars from Japan, South Korea and Germany.
It was unclear what the delay means for car manufacturers, such as BMW, who produce cars in Mexico, but are not fully in accordance with the conditions of the Trade Convention. BMW currently pays a rate of 2.5 percent to import vehicles from a factory in San Luis Potosí, Mexico. BMW also makes cars in Spartanburg, SC, one of the largest factories in the German company.
Mr. Trump said that the taxes were aimed at getting Canada and Mexico to stop streams of drugs and migrants across the American border. But after months of threats, he chose to take the rates into force this week, even after Canada and Mexico promised to spend more resources on checking the border and drug trafficking.
The leaders of Mexico and Canada have called on Mr Trump to drop the rates and say they are unfair and unjustified.
But Mr Trump refused to offer a wider postponement to Canada, despite new overtures by Prime Minister Justin Trudeau. Mr. Trump wrote on social media that he had spoken with Mr. Trudeau and was still not convinced that Canada had done enough to stop Fentanyl's flow across the border.
About the Truth Social, Mr Trump wrote that he had told Mr. Trudeau that “many people died of Fentanyl who came through the borders of Canada and Mexico, and nothing has convinced me that it has stopped.”
The president added: “He said it got better, but I said:” That's not good enough. “
Data shows that only a small amount of fentanyl enters the United States via Canada, and Canadians have claimed that they are an important source of drugs for the United States.
On Tuesday, Canada asked for consultations with the United States at the World Trade Organization about the rates, and said they violated the commitments that the United States had made at the WTO
Vice -President JD Vance and Howard Lutnick, the secretary of the trade, were on phone calls with Mr Trump and Mr. Trudeau. The discussion lasted 50 minutes, a Senior Canadian officer said, adding that the president has performed access to the Canadian dairy market for American producers.
Mr. Lutnick and the Minister of Finance of Canada, Dominic Leblanc, will continue with the conversation all day to find a de-escalatory compromise. Mr. Trudeau is not willing to eliminate the retribution rates of Canada on American goods, the official said, but is open to considering selective rate reduction or removal if the United States decide to remove or lower the rates for specific Canadian goods. The official spoke on condition of anonymity because they were not authorized to inform the press about the current negotiations.
In a press conference on Wednesday, President Claudia Sheinbaum of Mexico repeated several times challenging: “We will not submit.”
Mrs. Sheinbaum said she had a phone call with Mr. Trump planned for Thursday, but had no updates or information about Mr Lutnick's claims about a change in the rates. She said that if the rates were in force, the Mexican government would announce retaliation measures on Sunday, when it also called a demonstration in Mexico city.
“Between us all we have to defend our sovereignty,” she said.
Mrs. Sheinbaum also said that in response to the rates, her government was already about new trading partnerships, including with Canada and Chile.
“We will look at more similarities and partnerships with other countries,” she said.
Mr. Trump's move to impose a rate of 25 percent on most products from Canada and all products from Mexico, as well as an extra rate of 10 percent for all input from China, ensured that stock markets fell on Tuesday worldwide before shares for some industries were recovered somewhat.
Shares of some car manufacturers bounced back on Wednesday on the hope that Mr. Trump would write back his rates on Canada and Mexico. General Motors, Ford Motor and Stellantis Rose. Most car manufacturers rely on factories and suppliers in those countries for cars and parts and cannot easily shift production to the United States.
A postponement of a month will do little to resolve the long -term exposure of the industry to Mr Trump's rates pace. They include steel and aluminum rates that will come into effect on March 12 and “reciprocal” levies that Mr Trump intends to impose on April 2.
But it can give car manufacturers the opportunity to store cars and parts in Mexico and Canada and to collide the impact when the rates come into force later.
Kevin Roberts, Director of Economic and Market Information at Cargurus, an online shopping site for vehicles, said it was unrealistic to expect car companies to move their factories to the United States within a month.
“The car industry is so worldwide and so connected, you will not be able to move a large amount of production in the time of a month,” said Mr. Roberts.
A rate of 25 percent would add almost $ 12,000 to the average price of a car from Canada, Mr. Roberts and $ 10,000 at the average price of a car imported from Mexico.
Annie Correal” Matina Stevis-Gridneff” Vikas Bajaj And Neal E. Boudette contributed reporting.
