Trump mulls relaxing tariffs on car parts

United States President Donald Trump is seeking to relax tariffs on car parts as part of a tariff “destacking” plan, offering relief from some of the duties he earlier imposed.

A report by Financial Times (FT) on Wednesday said a 25 percent duty on all car imports will remain.

The report also said the separate 25 percent levy on parts would remain, and is expected to be enforced by May 3.

“Although Washington had already shielded autos from the ‘reciprocal’ tariffs announced on major trading partners, U.S. auto companies have in recent weeks pushed for further exemptions,” the report stated.

“The concessions will mark an initial win for the auto sector and another retreat by Trump on his most aggressive tariffs amid concerns that they will push up U.S. car prices.

“It will also disrupt supply chains and cause job losses.”

The report added that Trump’s trade policy has drawn sharp criticism from car executives, with John Elkann, Stellantis chairman, warning that it puts the American and European car industries at risk.

Earlier in April, Trump shocked the world when he announced tariffs of at least 10 percent on all goods entering the US.

The president assigned higher rates, as much as 50 percent, for what he described as the “worst offenders”.

Twelve states have sued the Trump administration at the US Court of International Trade in New York over the tariffs.