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Shoot from the lip President Trump, aka Calamity Donald, today imposed tariffs of 25% across North America disrupting the North American auto market that has thrived on 30 years of free trade. Any new tariffs in place for any significant length of time will be disruptive. The tariffs at 25% are significantly higher than the profits made by the automakers and their suppliers. It is widely – if not universally – held by economists that this is an economic disaster.

The tariffs are a sharp violation of the free trade deal with Canada, Mexico and the United States that Calamity Donald, renegotiated during his first administration. Using the dispute-settlement system to eliminate or adjust the tariffs could take years. Calamity Donald has already said he won’t act on any ruling against the United States. Roughly 44% of the new vehicles sold in the U.S. last year were imported from countries across North America, Europe and Asia. The automotive business involves a large and complex global supply chain, so new tariffs will challenge an industry that is already facing high costs. Higher costs mean fewer affordable vehicles for consumers. Higher costs result in lower sales volume in an industry that is central to U.S. economic health. (Read AutoInformed.com on: EV Satisfaction Improves But Trump Chaos Looms and Tariffs – Trump’s Next Economic Disaster Looming) Continue reading →