President Donald Trump signed two executive orders on Tuesday to soften steep auto tariffs, offering temporary relief to domestic carmakers and their suppliers while unveiling a preliminary trade agreement with a foreign partner.
Speaking in Michigan to mark his 100th day in office, Trump introduced a relief package that lets U.S. vehicle assemblers claim credits against duties on imported parts. Manufacturers can offset up to 3.75% of each vehicle’s retail value through April 2026, tapering to 2.5% by April 2027, to help smooth a two-year transition of supply chains.
The administration’s move responds to industry concerns that the planned 25% tariffs on auto parts—scheduled to take full effect on May 3—would drive up consumer prices, disrupt production schedules, and threaten jobs. General Motors, Ford, and Stellantis applauded the adjustment, calling it a welcome step toward predictability.
Commerce Secretary Howard Lutnick also disclosed a provisional trade deal awaiting parliamentary approval in the partner country. Trump hinted that negotiations with India are progressing well, saying, “India is coming along great.”
Despite the easing, Candace Laing of the Canadian Chamber of Commerce warned that only a complete removal of these tariffs would fully restore business confidence, noting that “ongoing ups and downs perpetuate uncertainty.”
Investor sentiment improved on the announcements, propelling the S&P 500 to its sixth consecutive gain. Nonetheless, General Motors withdrew its annual guidance and postponed its earnings call, citing lingering tariff-related ambiguity.
The administration has pledged to negotiate 90 new trade agreements in 90 days as part of a broader strategy to bolster U.S. manufacturing and secure more favorable global trade terms. Industry leaders continue to urge close collaboration to safeguard supply chains and maintain competitiveness.
