Donald Trump grants a month’s exemption to US firms on Mexico, Canada import tariffs after talks with ‘Big 3’ automakers

Amid concerns of widespread impact of trade war, United States President Donald Trump on Wednesday provided a month-long exemption to US automakers on tariffs on imports from Mexico and Canada.

The exemption will provide a much needed breather to the US companies from Donald Trump's stiff 25% tariffs on imports from Mexico and Canada, implemented on Tuesday, March 4.

Trump speaks with ‘Big 3’ automakers

Donald Trump provided the relaxation after speaking with leaders of the “big 3” automakers, Ford, General Motors and Stellantis, on Wednesday.

"We spoke with the Big Three auto dealers," Trump said in a statement read by his spokesperson.

Which companies will be exempted from Trump tariffs?

US automakers which agrees to shift its manufacturing unit to America via the United States-Mexico-Canada Agreement (USMCA) will get a one-month exemption. USMCA is a free trade agreement between the United States, Canada, and Mexico.

Which companies will be exempted from Trump tariffs?

 "We are going to give a one-month exemption on any autos coming through USMCA," the statement said, referring to the North American free trade agreement Trump renegotiated in his first term.

President Donald Trump will exempt automakers from his punishing 25-percent tariffs on Canada and Mexico for one month as long as they comply with the terms of an existing free trade agreement, the White House said.

Donald Trump open to hearing about additional exemptions

White House press secretary Karoline Leavitt on Wednesday informed that Donald Trump is ready to consider additional exemptions on imports from Canada.

Canadian Prime Minister Justin Trudeau's firm stance on retaliatory tariffs has complicated the scope of additional exemptions. Justin Trudeau is not willing to lift Canada’s retaliatory tariffs if Trump leaves any tariffs on Canada, a senior government official told The Associated Press.

Trump tariff to cost several jobs in US, Canada

Donald Trump's stiff tariff on imports would result in a massive job cut in the auto industry. The auto sector in the US and Canada would be able to survive only ten days after tariff implementation before they start shutting down the assembly lines in the U.S. and in Ontario, Ontario Premier Doug Ford earlier told The Associated Press.

“People are going to lose their jobs,” he said.

Commerce Secretary Howard Lutnick earlier said there might be carveouts coming to the 25% tariffs placed on Canada and Mexico.

The United States wants India to eliminate tariffs on car imports under a proposed trade deal between the two nations, Reuters reported.
The report said, quoting sources, that New Delhi is reluctant to immediately bring down such duties to zero even though it was planning further cuts, sources told Reuters.