Arizona Tribune - Trump suspends tariffs for autos as Trudeau call yields no breakthrough

Following talks with the "Big Three" US automakers -- Stellantis, Ford and General Motors -- Trump decided to "give a one-month exemption on any autos coming through USMCA," White House Press Secretary Karoline Leavitt said, referring to the North American free trade pact.

"They made the ask, and the president is happy to do it," Leavitt told reporters.

But prospects of wider relief were dampened after Trump's call with Trudeau, with the US leader saying he was unconvinced Ottawa had done enough to address Washington's concerns over illicit fentanyl.

In a social media post, Trump accused Trudeau of using the dispute to "stay in power," although he added that the discussion ended in a "somewhat" friendly manner.

Trump's sharp 25 percent tariffs on US imports from Canada and Mexico -- with a lower rate for Canadian energy -- kicked in Tuesday, sending global markets tumbling and straining ties between the neighbors.

Ottawa swiftly announced retaliatory levies, while Mexican President Claudia Sheinbaum plans to unveil her response at a mass rally on Sunday.

The US president has nominally cited illegal immigration and fentanyl trafficking in imposing the measures, though he frequently lambasts alleged trade imbalances when discussing levies.

Trudeau has said that less than one percent of the fentanyl and undocumented migrants that enter the United States come through the Canadian border, although Trump has shrugged off these figures.

- 'Offers' -

Earlier Wednesday, US Commerce Secretary Howard Lutnick said an announcement on Canada and Mexico tariffs was expected in the afternoon.

Trump is listening to "offers" from Canada and Mexico, Lutnick told Bloomberg Television on Wednesday.

While he dismissed the possibility of lifting the levies completely, Lutnick said Trump was mulling market segments where he could provide temporary relief.

"It will be 25 percent but it'll be, there will be some categories left out," he said.

During Trump's first term, he renegotiated the free trade pact with Mexico and Canada, touting the reworked deal at the time as the "fairest, most balanced, and beneficial trade agreement" in US history.

- 'Other trading partners' -

Sheinbaum, at her morning press conference Wednesday, said Mexico has to take "important decisions for the future of the country," adding that "if necessary, other trading partners will be sought."

Expressing a preference for a negotiated solution, she has said she anticipates speaking to Trump by phone on Thursday about tariffs on Mexican goods.

She earlier vowed retaliatory action and called for supporters to gather in Mexico City's main square on Sunday to hear details on her government's response.

Beyond the steep tariffs on Canada and Mexico, Lutnick maintained Wednesday that broader reciprocal tariffs, tailored to all US trading partners, are still coming on April 2.

Trump has vowed "reciprocal tariffs" targeting friend and foe to remedy potential practices deemed as unfair.

Some of these duties could come immediately, although Lutnick told Bloomberg that others could take a month or longer.

This week, Trump also inked an order doubling an additional tariff rate on Chinese imports from 10 percent to 20 percent, similarly over the country's alleged role in illicit fentanyl entering the United States.

The latest US duties pile atop existing ones on various Chinese products.

Beijing hit back swiftly, promising 10 percent and 15 percent tariffs on a range of US agricultural imports.

Economists warn that tariff hikes stand to bog down economic growth and add to inflation in the world's biggest economy.

The mounting trade war could complicate Trump's stated aims of bringing cost-of-living relief to households.

T.Wright--AT