Trump Changes Course on Auto Tariffs. For Now

The president is giving automakers a month to “get on it, start investing, start moving, shift production here to the United States of America where they will pay no tariffs.”

Good Morning!

Here are today’s highlights:

• The Department of Veterans Affairs is tearing up its contracts with businesses owned by veterans.

• Business confidence is cratering in Massachusetts and surging in Texas.

• The new SBA chief is focusing on fraud. Ami Kassar thinks that could be a mistake.

• Do you have your year-end financial statements for 2024? If not, Tracy Bech wants to know why not.

INTERNATIONAL TRADE

President Trump is giving American carmakers a one-month reprieve to start moving production to the U.S.: “Karoline Leavitt, the White House press secretary, read a statement from Mr. Trump on Wednesday saying that White House had spoken with the three largest automakers, and that a one-month exemption would be given to cars coming in through United States-Mexico-Canada Agreement. ‘At the request of the companies associated with USMCA, the president is giving them an exemption for one month so they are not at an economic disadvantage,’ the statement said.”

• “The three automakers that Mr. Trump spoke with were General Motors, Ford Motor, and Stellantis. Asked why Mr. Trump granted only a one-month reprieve, Ms. Leavitt said the president expected the automakers to move production back to the United States. The message, she said, was to ‘get on it, start investing, start moving, shift production here to the United States of America where they will pay no tariffs.’”

• “The reprieve was a demonstration of the haphazard approach Mr. Trump has taken to trade policy, with the president announcing, pausing, and then proceeding with a policy that is deeply influential for the North American economy within a matter of weeks.”

• “The [auto] executives told the president that putting tariffs on cars and parts from Canada and Mexico would effectively erase all of their companies’ profits by imposing billions of dollars of new costs on them, the person said. They asserted that cars built in those countries supported jobs in the United States at parts factories, dealers, and other related businesses.”

• “They said they had invested in factories across North America because they were assured by NAFTA and the USMCA, the trade agreement Mr. Trump negotiated with Canada and Mexico in his first term, that the continent would be a free-trade zone, the person said.” READ MORE