Trump to sign executive order to soften blow of auto tariffs

WASHINGTON

US President Donald Trump will sign an executive order to dampen the effects of auto tariffs Tuesday as he prepares to deliver remarks in the historical home of American auto manufacturing.

Spokesperson Karoline Leavitt did not provide additional details on what the order would include, but a senior Commerce Department official later told reporters that Trump's order will include a 15% rebate for vehicle manufactures that finish their automobiles in the US. That will be used to off-set tariffs on imported vehicle parts.

The rate would last for one year, before being reduced to 10% in the following year in an effort to incentivize vehicle manufacturers to on-shore their supply chains, the official told reporters on condition of anonymity. The rebates are available to all vehicle manufactures that operate plants in the US, regardless of whether the company is foreign-based or domestic.

The official also clarified that tariffs will not be stacked, meaning that if a part is subject to more than one tariff, it will only be charged the highest rate of a single tariff rather than a combined rate. Questions had swirled over 25% tariffs that Trump has imposed on steel and aluminum imports would compound the economic blow for auto manufacturing.

Imported finished foreign automobiles are already subject to a 25% tariff Trump imposed earlier this month.

"President Trump has had meetings with both domestic and foreign auto producers, and he's committed to bringing back auto production to the US. So we want to give the automakers a pass to do that quickly, efficiently and create as many jobs as possible," Treasury Secretary Scott Bessent told reporters alongside Leavitt during an earlier White House briefing.

While the White House has not said when Trump will sign the order, he is expected to address a rally of supporters on Tuesday evening to mark his first 100 days in office. The event will be held in Michigan, home of the Big Three US auto manufacturers.

Asked about Trump's wider tariff war and ongoing negotiations with foreign nations to broker new trade agreements, Bessent said negotiations are continuing with 18 countries with additional meetings to happen with them "over the next few weeks."

Bessent demurred when asked if the US is holding tariff talks with China amid Beijing's ongoing denial, saying: "We're not going to talk about who's talking to whom, but I think that, you know, over time, we will see that Chinese tariffs are unsustainable for China."

"I've seen some very large numbers over the past few days to show if these numbers stay on, Chinese could lose 10 million jobs very quickly, and even if there is a drop in the tariffs, they could lose 5 million jobs," he said.

"They sell almost five times more goods to us than we sell to them, so the onus will be on them to take off these tariffs. They're unsustainable for them."