They are on, they are off, they are on again and now they are off again, - for now. The Trump administration cannot seem to settle on whether it should, or should not, put tariffs on vehicles imported into the United States. 

While Europe’s car makers are largely in the dark about what is going to happen, the situation is even more uncertain for Canada and Mexico. Neither country of course has much in the way of home grown vehicle makers, however, both are vital bases for US manufacturers, who ship some of their most popular models from Canadian and Mexican production sites back to the US. 

Of the vehicles made in Canada and Mexico, many are examples of the beloved pick-up trucks that huge numbers of Trump supporters drive. According to a recent study, pickup owners are twice as likely to say they vote Republican as Democrat. A 25% tariff on these vehicles would of course directly impact these buyers, adding around $5000 to $7000 to the price of a new truck, as well as having a knock on effect on used vehicle values. 

Some of the top selling “American” trucks are the Chevrolet Silverado, GMC Sierra, Ford Maverick, and Ford Ram and all of these are made in either Canada or Mexico. Popular Toyota pickups are also made in Mexico.

Vehicle production is of course a complex process, so even if vehicle makes wanted to make more units in the USA it would take them many years to organise. The other issue which the Trump administration seems to have ignored, is that even with cars and trucks made in the USA, very few parts are locally sourced, with many being made in Mexico, Canada and Europe. With blanket 25% tariffs on parts, as well as finished vehicles, the price of components would rise sharply and this would have to be passed on to American consumers. 

With a key factor in his election being a promise to bring prices down, the idea of paying many thousands of dollars more for a truck will certainly not be popular with Trump supporters.