Core Content and Impact Analysis of Trump's Tariff Policy in 2025

1. Latest tariff updates (as of March 29, 2025)

Automobile tariff upgrade: Starting from April 2nd, the United States will impose a 25% tariff on imported passenger cars, light trucks, and key components (engines, transmissions, etc.), and components that comply with the USMCA agreement can be temporarily exempted.

Chinese goods tax hike: The Trump administration has imposed a 10% tariff on Chinese goods since February 1st, adding to the original post tax tariff rate of 35% -45% for some goods. Canada and Mexico face a 25% independent tariff.

Expand the scope of taxation: Goods such as timber and medicine are also included in the tariff list, and the grace period for automotive parts is extended up to May 3rd.

2. Policy objectives and logic

Economic demands

Claiming to reduce the trade deficit through tariffs, protect local manufacturing industries such as steel, aluminum, and electronics, and pressure

China to abandon high-end industries such as semiconductors and AI.

Claiming that 'tariffs are paid by other countries', the actual costs are mostly passed on to American consumers (such as rising retail prices of cars).

Political Motivation

Fulfilling campaign promises and strengthening the "America First" image to consolidate voter support.

Utilize the International Economic Emergency Powers Act to expand the scope of tariff application and enhance policy flexibility.

3. Economic impact and disputes

Domestic cost in the United States:

Consumers bear the main costs, such as laundry taxes resulting in an additional annual expenditure of $1.5 billion.

The problem of hollowing out the manufacturing industry remains unresolved, and companies such as TSMC are still facing difficulties in starting production in the United States. Tariffs may exacerbate supply chain cost pressures.

International response:

The Chinese side clearly opposes it, and the Ministry of Foreign Affairs emphasizes that "there is no winner in a trade war" and suggests taking

countermeasures.

Canada and Mexico are facing export shocks, but are seeking partial exemptions through the USMCA agreement.

4. Potential risks and long-term challenges

Supply chain disruption: High tariffs may lead to global industrial chain restructuring and increase compliance costs for businesses.

Inflation pressure: The rise in commodity prices coupled with tariffs may push up the US inflation rate and weaken consumer purchasing power.

Diplomatic friction: Unilateral tariff policies may intensify conflicts with trading partners and affect multilateral cooperation mechanisms.

5. Key time nodes

On April 2, 2025, tariffs on automobiles and their components officially came into effect.

May 3, 2025: The grace period for tariffs on automotive parts ends.

Long term uncertainty: Trump says tariffs are 'permanently effective' but leaves room for adjustment.