Trump plans to delay auto tariffs for six months: Industry sources

 US President Donald Trump has threatened to impose 25 per cent punitive duties on autos.
US President Donald Trump has threatened to impose 25 per cent punitive duties on autos.PHOTO: AFP

NEW YORK (AFP) - US President Donald Trump plans to hold off on imposing steep tariffs on imported autos while the US pursues agreements with key trading partners, industry sources told AFP on Wednesday (May 15).

Mr Trump has threatened to impose 25 per cent punitive duties on autos - a possibility that has worried the European Union and Japan in particular, as well as Mexico and Canada.

Facing a deadline to announce a decision by Saturday on whether to implement the tariffs based on national security concerns, the sources said Mr Trump would hold off as negotiations proceed.

New tariffs risk exploding already tense trade relations with Washington's major trading partners, who are angry about punitive duties on steel and aluminium imposed last year.

CNBC and other media earlier on Wednesday cited government sources also saying that Mr Trump was expected to try negotiations before imposing any new import taxes.

German car-makers are especially concerned about the tariff threat, but Mr Trump and European Commission President Jean-Claude Juncker declared a truce in July 2018 in order to pursue negotiations.

EU officials have repeatedly said they expect the US to abide by the agreement to hold off on any new tariffs.

 
 
 
 

Under US law, Mr Trump must make a decision 90 days after receiving the report from the Commerce Department on the national security threat faced by the American auto sector.

If he decides to impose tariffs, they must take effect 15 days after the announcement.

However, he can delay implementation for 180 days if he decides to negotiate.

The White House currently is negotiating trade deals with the EU and Japan, and late last year completed a revised accord with North American trading partners Mexico and Canada