Donald Trump announces 25% 'permanent' auto tariffs on all foreign imported cars starting April 2

Donald Trump has announced a sweeping tariff plan that could shake the global auto industry. Starting April 2, all imported cars in the US will face a permanent 25 per cent duty, with collection beginning the next day.

The US President announced the move from the Oval Office on Wednesday, stressing it as a major step toward reshaping the country’s trade policies.

“What we're going to be doing is a 25 per cent tariff on all cars that are not made in the United States. This will be permanent,” Trump said. “We start off with a 2.5 per cent base, which is what we're at, and go to 25 per cent.”

He argued the hike would benefit American industry and consumers. “This will continue to spur growth like you haven't seen before. But if you build your car in the United States, there is no tariff.”

The auto tariff announcement comes just ahead of Trump’s broader trade agenda, which is expected to roll out on April 2, which he has dubbed “liberation day.” The upcoming package will include a series of reciprocal tariffs aimed at imported goods from nations the US claims unfairly tax American exports.

Trump has consistently promoted tariffs as a way to correct trade imbalances and boost domestic production. However, the aggressive approach has rattled markets and raised concerns among investors, executives, and economists.

He had floated the 25 per cent figure in February but gave no details. By Monday, he hinted that action was imminent, saying the new auto levies would arrive “in the very near future.”

While firm on car imports, Trump hinted that the reciprocal tariffs could be less severe than expected. “We're going to make it very lenient,” he said. “I think people will be very surprised. It'll be, in many cases, less than the tariff they've been charging for decades.”

Amid speculation that Tesla CEO Elon Musk had influenced the move, Trump was clear. “Musk did not advise on auto tariffs,” he said. “He has never asked me for a favour.” Still, he maintained the plan would be “net neutral or maybe good for Tesla,” citing conversations with major automakers.

Trump also floated the idea of using tariff reductions as leverage in ongoing talks with China over TikTok’s future. “With respect to TikTok, and China is going to have to play a role in that, possibly in the form of an approval, maybe, and I think they'll do that. Maybe I'll give them a little reduction in tariffs or something to get it done,” he said.

He added he might extend the deadline to finalize a TikTok deal if needed. “There’s a lot of interest in TikTok,” Trump noted, adding, “numerous ways to buy TikTok” were being explored.