President Trump signed a pair of executive orders on Tuesday that walked back some tariffs for carmakers, removing levies that Ford, General Motors and others have complained would backfire on U.S. manufacturing by raising the cost of production and squeezing their profits.
The changes will modify Mr. Trump’s tariffs so carmakers that pay a 25 percent tariff on auto imports are not subject to other levies, for example on steel and aluminum, or on certain imports from Canada and Mexico, according to the orders. However, the rules do not appear to protect automakers from tariffs on steel and aluminum that their suppliers pay and pass on.
Carmakers will also be able to qualify for tariff relief for a proportion of the cost of their imported components, though those benefits will be phased out over the next two years.
Mr. Trump, speaking on Tuesday before leaving the White House for a trip to Michigan, said the administration wanted to help automakers “enjoy this little transition, short-term.”
“If they can’t get parts, we didn’t want to penalize them,” he said.
The decision to reduce the scope of the tariffs is the latest sign that the Trump administration’s decision to impose stiff levies on nearly all trading partners has created challenges and economic uncertainty for American companies. But even with the concessions announced Tuesday, administration policies will add thousands of dollars to car prices and endanger the financial health of automakers and their suppliers, analysts said.
Mr. Trump signed the executive orders aboard Air Force One as he flew to Michigan, home to America’s largest automakers, for a speech marking his 100 days in office.
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