Automakers Exhale with Relief as Trump Puts Tariffs on Hold for 30 Days | Carscoops

      The suspension follows Canada's announcement of imposing 25% tariffs on $155 billion worth of US imports.

      16 hours ago

      by Brad Anderson

      Mexico has consented to send 10,000 soldiers to its border to curb drug and migrant trafficking.

      Canada aims to reinforce its border with the US and tackle organized crime.

      Discussions will carry on over the next 30 days to avert a full-scale trade war.

      Both Mexico and Canada have received a 30-day delay on the extensive 25% tariffs set forth by US President Donald Trump, just hours before they were scheduled to be implemented. Mexico was the first to benefit from this delay after its President pledged to enhance security at the Southern Border.

      Given the extensive automobile manufacturing in Mexico that gets imported into the United States, this postponement is positive news for both the automotive sector and consumers who might otherwise face increased costs.

      On Truth Social, Trump shared that he had a "very friendly conversation" with Mexican President Claudia Sheinbaum shortly before the tariffs were about to be enforced. Trump noted that Sheinbaum "agreed to immediately deploy 10,000 Mexican Soldiers to the border between Mexico and the United States," with a specific focus on halting the flow of fentanyl and unauthorized migrants into the US.

      Read: Trump's Tariffs Could Burden US Auto Industry by $33 Billion

      While this agreement has temporarily halted the tariffs, talks are still in progress. Secretary of State Marco Rubio, Treasury Secretary Scott Bessent, and Commerce Secretary Howard Lutnick are actively engaged in discussions with their Mexican counterparts to explore potential permanent solutions.

      Although there’s no assurance that Mexico will completely evade tariffs, this is a significant move toward reducing tensions between the two nations. Should the tariffs take effect, it is likely that retailers would pass price increases onto consumers, potentially impacting the auto industry as well. Mexico exports over 2.3 million vehicles to the United States each year, with multiple car manufacturers producing vehicles in Mexico for the US market.

      Many of the most popular vehicles in the US are manufactured in Mexico. Automakers with plants there include GM, Ford, Honda, Toyota, Nissan, BMW, and Volkswagen. As a result, models like the Honda HR-V, Nissan Sentra, Chevrolet Blazer, Ford Maverick, and BMW 3-Series Sedan could all face price increases if tariffs are eventually imposed.

      Canada’s Delay

      Shortly after Trump announced the postponement of tariffs against Mexico, Canadian Prime Minister Justin Trudeau stated he had a "good call" with Trump and agreed to the tariff postponement. He mentioned that Canada will bolster its border with "new helicopters, technology, and personnel," aiming to impede the flow of fentanyl.

      Trudeau also disclosed plans to appoint a so-called "Fentanyl Czar," classify cartels as terrorist organizations, and establish a joint strike force with the U.S. targeting organized crime, fentanyl trafficking, and money laundering.

      It seems Canada hasn’t made any new promises regarding its border security with the US. As noted by CNBC, the measures highlighted by Trudeau were already part of Canada's Border Plan released around six weeks ago.

      More: Canada Responds with 25% Tariffs on U.S. Cars, EVs, and More

      Meanwhile, Canada is taking action. In reaction to Trump’s tariff threats, the country has introduced a two-phase counter-tariff plan aimed at various US goods, including up to 25% on all American-made vehicles. If enacted, these measures could significantly impact automakers and escalate trade tensions between the two countries.

      I just had a good call with President Trump. Canada is moving forward with our $1.3 billion border plan — enhancing the border with new helicopters, technology, personnel, improved coordination with our American partners, and additional resources to halt the flow of fentanyl. Nearly… — Justin Trudeau (@JustinTrudeau) February 3, 2025