Trump Weighs Tariff Exemptions for Automakers Amid Industry Pressure

President Donald Trump is considering exempting automakers from certain tariffs, the White House confirmed on Wednesday, signaling potential relief for a U.S. auto industry facing mounting cost pressures from trade policy.

The move comes after six major U.S. auto policy groups launched a rare joint appeal this week, warning that the scheduled 25% tariff on imported auto parts, set to take effect by May 3, could deeply disrupt production lines and push struggling suppliers further into distress.

“President Trump has indicated an openness to reconsidering the administration’s 25 percent tariffs on imported automotive parts,” the groups wrote in a letter. “That would be a positive development and welcome relief.”

Financial Markets React

The news led to modest gains in auto stocks during after-hours trading.

• General Motors (GM) closed up 0.24% and added another 1.51% in after-hours movement, reflecting investor optimism about potential policy reversals.

Exemption May Exclude Broader Tariffs

The proposed exemption would not cover:

• 25% tariffs already levied on steel and aluminum

• 25% tariffs on imported vehicles

However, a report from the Financial Times suggests that the administration may separate auto parts from broader sanctions originally tied to China’s trade practices and other geopolitical considerations.

Industry Leaders Demand Clarity

Auto executives continue to express concern over regulatory unpredictability.

“First of all, I need clarity, and then I need consistency,” said Mary Barra, CEO of General Motors, at Semafor’s World Economy Summit. “To make investments and be good stewards of capital, I need to understand what the policy is.”

Barra noted that GM has made strategic adjustments to accommodate the changing trade landscape but said no major changes are planned without more regulatory guidance.

Automakers Warn of Broader Fallout

Industry representatives cautioned that stacking tariffs on top of existing duties could jeopardize U.S. production and push key suppliers — already facing thin margins — into financial trouble.

“These upcoming levies could break already strained suppliers,” said a spokesperson from the coalition of policy groups representing automakers, parts manufacturers, and franchised dealers.

Canada Tariff Also in Spotlight

Separately, Trump hinted at increasing the 25% tariff on cars imported from Canada.

“All we’re doing is saying, ‘We don’t want your cars, with all due respect. We want to make our own cars,’” the President told reporters.

This statement adds another layer of uncertainty for cross-border supply chains, particularly for automakers operating in North America under the USMCA agreement.