Trump's Auto Tariffs: A New Blow to Global Trade

President Donald Trump announced a 25% tariff on imported cars, sparking market unrest as auto shares dropped in Asia and Europe. Analysts warn this move may prolong trade volatility and impact U.S. automakers, with potential inflation risks and calls for negotiations in global markets.

In a significant move impacting the global automobile industry, U.S. President Donald Trump declared that the country will impose a 25% tariff on all cars not manufactured within the United States. The announcement, made late Wednesday, suggests the tariffs will be a permanent fixture.

The decision has already sent shockwaves across global markets. Shares of automotive giants like General Motors and Ford saw a dip in extended trading hours. Across Asia, particularly in South Korea and Japan, the market reaction was swift, erasing approximately $16.5 billion from transport stocks in Tokyo, based on the latest data from LSEG.

Economic experts express concern over the broader implications of this policy shift by the Trump administration. Financial market analysts worry about prolonged trade uncertainties, while strategists suggest potential negotiations surrounding these tariffs. The new levies could escalate costs not just for imported vehicles but also for American-produced cars if part supplies are affected.

(With inputs from agencies.)