Trump pauses some tariffs on autos, Canadian and Mexican goods
It’s been a busy 48 hours as President Trump has issued, and in some cases temporarily delayed sweeping tariffs which had spurred retaliation from the affected countries.
In a series of executive orders issued March 4, Trump enacted a 25% tariff on nearly all goods coming to the U.S. from Canada and all products being imported from Mexico. The president also doubled the tariff he imposed last month on Chinese products to 20%.
However, on Wednesday, March 5, Trump announced he would grant a one-month delay for any tariffs on imported vehicles from Canada and Mexico that comply with the terms of the United States-Mexico-Canada Agreement (USMCA), a trade agreement Trump signed with the other two countries in July 2020 during his first presidential term.
Trump followed that decision up with executive orders on Thursday, March 6 that exempt all Canadian and Mexican imports which fall under the USMCA from the 25% tariff until Wednesday, April 2. According to a statement from the White House to CNBC, roughly 50% of Mexican imports and 38% of Canadian imports fall under USMCA.
In response to the March 4 tariff order, Canadian Prime Minister Justin Trudeau said Canada would impose tariffs on more than $100 billion of American goods over the course of 21 days. CNN reports Trudeau still plans to enact these retaliatory tariffs unless the U.S. rolls back the 25% tariff on Canada permanently.
Mexican president Claudia Sheinbaum, who previously said retaliatory tariffs on U.S. goods would begin Sunday, March 10, has been more conciliatory in her public response.
Sheinbaum posted on X (the social network formerly known as Twitter) that she and Trump “had an excellent and respectful call in which we agreed that our work and collaboration have yielded unprecedented results, within the framework of respect for our sovereignties.”
In the post, Sheinbaum also said Mexico and the U.S. will cooperate on “reducing the illegal crossing of fentanyl into the United States, as well as weapons into Mexico.” Trump had cited insufficient efforts by Canada and Mexico to stop the flow of illegal narcotics, including fentanyl, over their borders into the U.S. as a major reason for instituting the tariffs.
Meanwhile, in a post on his Truth Social social network, Trump said that, "I did this as an accommodation, and out of respect for, President Sheinbaum. Our relationship has been a very good one, and we are working hard, together, on the border, both in terms of stopping illegal aliens from entering the United States and, likewise, stopping fentanyl."
Trump was more critical of Trudeau on Truth Social, accusing him of trying to use the tariffs for his own political gain.
In a statement emailed to Chain Store Age, FMI – the Food Industry Association, expressed thanks to Trump.
"FMI and our members are grateful to President Trump and his team for pausing tariffs related to products covered under USMCA, which includes food and agricultural goods," FMI said in the email. "We are pleased the president took action by suspending these tariffs, allowing him to follow through with his promise to make groceries more affordable for hardworking families in every community in America. We stand ready to work with the president and his team to make sure all Americans can access the groceries they need at prices that fit their budgets."
The Retail Industry Leaders Associaton (RILA) emailed a statement from its executive VP of public affairs Michael Hanson to Chain Store Age, warning of the negative impacts of tariffs.
“Families need certainty — not disruption and volatility — to write their budgets and ensure they can afford the household goods they need at home, at work and at school," Hanson said in the statement. "Tariffs hit families where it hurts: groceries, school supplies and apparel. This continuous tariff uncertainty increases pocketbook anxiety for families and also throws a wrench into future business planning and investment."
Trump did not offer any temporary exemptions on tariffs affecting goods from China, which has indicated it plans to retaliate against the U.S. rather than seek cooperation. China has already responded with tariffs of up to 15% on a wide array of U.S. agricultural goods and has also expanded the number of U.S. companies subject to export controls and other restrictions by about two dozen.
In total, the U.S. does about $1.6 trillion in annual business with the three countries, which account for more than a third of the goods and services that are imported to or bought from the United States and are this country's largest trading partners.
Other tariff news
Trump previously announced that a plan to apply reciprocal tariffs on imports that equal any tariffs or other levies put on those products from the U.S. by other countries is still scheduled to go into effect Wednesday, April 2, 2025.
In other tariff-related developments, the Trump Administration briefly excluded shipments from China from the de minimis exception, which exempts imported shipments with an aggregate value of less than $800 from having to pay tariffs but then reverted to the same eligibility requirements for Chinese goods that had been in place since September 2024.
[READ MORE: Trump restores tariff loophole used by used by low-cost shopping apps]
