President Trump's threat of 25% tariffs on goods from Canada and Mexico has sent shockwaves through the auto industry, which relies on intricate, cross-border supply chains. The tariffs, temporarily paused, pose a significant risk to businesses like Laval Tool, which experience multiple border crossings during production. Uncertainty hangs over the industry as manufacturers grapple with the potential costs of tariffs and explore options like shifting operations or passing on expenses to consumers.
On Sunday, President Donald Trump said the US would begin to place 25 percent tariffs on goods imported across the Canadian and Mexican borders, a stunning reversal of decades of free trade across North America. Both nations threatened to retaliate with their own tariffs. Then, a last-minute reprieve: Late Monday, Trump said tariffs against both nations would “pause” as both nations pledge to boost their border security.
Getting those products to the US quickly is more expensive right now because many companies are moving goods at once, says Paul Isley, a professor of economics at the Seidman College of Business at Grand Valley State University who forecasts business conditions in Western Michigan, where many auto suppliers and automakers are based. Then, storing that extra inventory incurs holding costs. In the US, local companies are also responding by holding off on hiring, Isley says.
Economy TARIFFS AUTOMOTIVE INDUSTRY TRADE WAR CANADA MEXICO SUPPLY CHAINS
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