Trump Imposes 25% Tariff on Auto Parts, Triggering Global Economic Concerns

US President Donald Trump has announced a 25 per cent tariff on imported automobile parts, set to take effect on April 2. He argues that this move will encourage the relocation of auto manufacturing to the United States, ultimately benefiting the country's economy.

However, critics warn that the tariffs will lead to higher automobile prices, as many parts are imported from countries like Canada and Mexico. The increased costs could reduce car sales, potentially pushing some companies toward bankruptcy. The decision is expected to have a significant economic impact on nations such as Japan, Mexico, Canada, and Germany.

Trump has already imposed a 25 per cent tariff on steel and aluminium imports. In response to criticism, he stated that these tariffs are expected to generate 100 billion dollars in revenue for the US government.

While the administration views this as an economic boost, the decision has sparked strong international backlash. Canadian Prime Minister Mark Carney condemned the tariffs as a "direct attack' on Canadian workers, vowing to protect them. European Commission President Ursula von der Leyen warned that the tariffs would harm both businesses and consumers. Meanwhile, Japan is considering countermeasures, and South Korea’s auto industry is bracing for major disruptions, with emergency plans expected in April.

The tariffs are already affecting global markets, causing declines in the stock prices of major automakers such as Toyota, Nissan, Hyundai, and Honda. Economic experts caution that these measures could lead to higher consumer prices and job losses on both sides of the border. Trump's decision is part of his broader strategy to impose reciprocal tariffs on countries he believes unfairly tax US goods.