The timing of the announcement suggests it would coincide with his April 2 plans for reciprocal tariffs targeting countries responsible for the bulk of the U.S. trade deficit.

U.S. President Donald Trump announced plans Wednesday to impose tariffs of up to 25 percent on auto imports, expanding the global trade war he launched upon returning to the White House, in a move industry experts expect will raise prices and curb production.

"What we're going to do is put a 25% tariff on all cars not made in the United States," Trump said at an Oval Office event. "We're starting with a base of 2.5%, which is what we're at, and we're going to 25%."

Trump has long promised higher tariffs on imported vehicles, and the timing of the announcement suggests they would coincide with his April 2 plans for reciprocal tariffs targeting countries responsible for the bulk of the U.S. trade deficit.

Trump, who sees tariffs as a revenue-raising tool to offset his promised tax cuts and revive a long-declining industrial base, has been promising for weeks to announce such levies, and possibly some additional sector-specific tariffs, on April 2.

Since taking office on January 20, Trump has announced and delayed tariffs on Canada and Mexico for what he claims is their role in allowing the opioid fentanyl into the country and has imposed taxes on imported goods from China for the same reason.

He has also imposed steep tariffs on steel and aluminum imports and has repeatedly announced plans to introduce global reciprocal tariffs on April 2.

Shares of publicly traded U.S. automakers fell ahead of the announcement, amid concerns that the tariffs would negatively impact a global auto industry reeling from the uncertainty caused by Trump's rapid tariff threats and occasional rollbacks.

The tariffs could also increase the cost of cars for consumers by thousands of dollars, hurting new vehicle sales and leading to job losses, as the U.S. auto industry relies heavily on imported parts, according to the Center for Automotive Research.

The United States imported $474 billion worth of automotive products in 2024, including $220 billion worth of passenger cars. Mexico, Japan, South Korea, Canada, and Germany, all close U.S. allies, were the top suppliers.

Cox Automotive, an automotive services provider, predicted Wednesday that without tariff exemptions for the auto industry on imports from Mexico and Canada, a vehicle manufactured in the United States would cost $3,000 more and a vehicle manufactured in Canada or Mexico would cost $6,000 more.