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Key Takeaways
- The Wall Street Journal reported on Monday night that the Trump administration will adjust its tariffs against the auto industry.
- Automakers reportedly won't have to pay tariffs like those on steel and aluminum if they are also paying tariffs on imported cars.
- General Motors on Tuesday postponed its earnings call to Thursday, citing "recent reports regarding updates to trade policy."
The Wall Street Journal reported on Monday that automakers could be set to receive a respite from recent pressures as the Trump administration will make changes in how tariffs affect the industry.
The Journal reported that if car manufacturers already pay tariffs on imported vehicles they won’t be required to pay the 25% tax on imports of aluminum and steel.
The report stated that the Trump administration may announce the latest changes in its trade policies as soon as Tuesday, before the President’s scheduled Michigan rally to mark his 100th day in office. The auto tariffs will have a major impact on Michigan. This is the home of General Motors (GM), Ford (F) and other “Big Three’ automakers.
Journal said that the change is likely to be retroactive. This would allow automakers reimbursement for tariffs paid in the past. The report states that the separate tariffs on auto parts will also be altered so that car makers can be reimbursed for a portion of the car’s cost. Experts say that the prices of new and used cars could increase by thousands of dollars as a result of the tariffs. Car insurance would also become more expensive.
General Motors, likely due to the report’s release, delayed its first-quarter earnings conference call on Tuesday and delayed updating its full year guidance by two days.
GM shares were down by 1.5% during premarket trading. Shares of other U.S. automobile manufacturers like Ford, Stellantis(STLA), Tesla(TSLA), Rivian(RIVN) and Stellantis were also little changed.
