# Trump mulls exemptions for carmakers from tariffs

**5 March 2025**

*Peter Hoskins*
*Business reporter, BBC News*

## US Commerce Secretary Howard Lutnick

US Commerce Secretary Howard Lutnick has said President Donald Trump is considering a deal that would offer exemptions from tariffs on Canada and Mexico, including potentially for carmakers.

The possibility of a rollback, which he said could be announced on Wednesday, came as many US businesses raised concerns about Trump's decision to hit US imports from its two closest trade partners with a 25% import tax.

After two days of declines, the main US stock indexes were trading slightly higher early on Wednesday.

Canada's Minister of Foreign Affairs Mélanie Joly told the BBC's Newsnight on Tuesday that her office had not been contacted about any plans around reducing tariffs.

US officials "can say many things" but "the only one that really takes a decision is President Trump," Joly said.

The US president used a large part of his , but he did not say whether he planned to cut the tariffs that came into effect this week.

Canada and Mexico announced retaliatory import levies on the US after Washington's 25% tariffs on its two neighbours came into effect on Tuesday.

Goods worth billions cross the borders of the US, Canada and Mexico each day and their economies are deeply integrated.

Trump says he wants to protect American industry and boost manufacturing, but many economists warn such tariffs could lead to prices rising for consumers in the US.

On Wednesday, Lutnick said tariffs would be in place, but suggested some goods could be "left out".

"There are going to be tariffs - let's be clear - but what he's thinking about is which sections of the market that maybe he'll consider giving them relief until we get to, of course, April 2," Lutnick told Bloomberg on Wednesday.

"It will be 25% but there will be some categories left out - it could well be autos. It could be others as well," he added.

A day earlier on Fox News, Lutnick had raised the possibility of a compromise and reduction of tariffs for Mexico and Canada, saying Trump was weighing offers to meet his allies "in the middle".

Trump has said he would move ahead on 2 April with plans for reciprocal tariffs on other countries around the world that he sees as treating the US unfairly.

## Canadian Prime Minister Justin Trudeau

, calling it a "very dumb thing to do" and vowed to conduct a "relentless fight" to protect its economy.

Trudeau announced retaliatory tariffs on US exports and warned that a trade war would be costly for both countries.

But Trump pushed even further in a post on his Truth Social platform, saying: "Please explain to Governor Trudeau, of Canada, that when he puts on a Retaliatory Tariff on the U.S., our Reciprocal Tariff will immediately increase by a like amount!"

Trudeau accused the US president of planning "a total collapse of the Canadian economy because that will make it easier to annex us".

"That is never going to happen. We will never be the 51st state," he told reporters.

Washington also ramped up its trade war with Beijing on Tuesday as a new 10% levy on Chinese imports that came into effect - which adds to existing levies from Trump's first term and those announced last month.

"China will fight to the bitter end of any trade war," a Chinese foreign ministry spokesperson said after their country announced tit-for-tat tariffs on agricultural imports from the US.

## China retaliates against US tariffs - but it also wants to talk



## How is China hitting back against US tariffs?



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