• Automakers have been lobbying the White House to avoid tariffs, arguing they would hurt the industry.
• Industry analysts say uncertainty over tariffs is detrimental to the auto industry.

The U.S. auto industry Monday morning sought clarity over the latest news implying that automakers might dodge the most dreaded tariffs. Reports over the weekend said President Donald Trump’s administration is likely to exclude a set of sector-specific tariffs while applying reciprocal levies on April 2.

The auto industry would be part of those sector-specific tariffs to be excluded, according to reports in Bloomberg News and the Wall Street Journal, which both cited officials as sources. Stocks soared Monday on the reports.

On Monday morning, Ford Motor Co. and Stellantis declined to comment. General Motors deferred comment to the American Automotive Policy Council, the lobbying group for the Detroit Three, which did not immediately respond to a request for comment. Some of the automakers said their policy teams were still seeking clarity on what this development will mean for them.

Similarly, the supplier industry trade association MEMA declined comment, with spokesperson Megan Gardner telling the Free Press, “At this point, given the uncertainty and evolving nature of the tariff discussions, we’re focusing our commentary on more concrete policy developments. That said, we’re closely monitoring the situation and will be ready to comment if and when the administration provides more clarity.”

A White House official said Trump is still deciding what he will do about sector-specific tariffs on April 2 or afterward, and no final decision has been made. This person provided the information to the Free Press asking to not be named because they are not authorized to speak on the record.

The UAW, which has come out in support of tariffs, believing they will boost U.S. manufacturing, had not provided a reaction.

The Alliance for Automotive Innovation, which represents automakers, did not immediately respond to a request for a comment, but it has said that tariffs would have a “negative impact on vehicle price and vehicle availability” that would be felt almost immediately.

The Detroit car companies have continually been communicating with the White House. The Detroit Free Press has learned from at least three sources that the top executives from the Detroit automakers have been regularly visiting or communicating with Trump over the past several weeks in an attempt to outline the dire impact tariffs would have on the industry. These sources asked to not be named because they are not authorized to share that information publicly, but one of them said the talks with Trump have not always gone smoothly.

It’s partly for that reason, along with the vagueness of this latest development, that some industry analysts aren’t ready to say the auto industry is in the clear.

“I can’t imagine anyone saying, ‘Phew we’re done! That’s it.’ That’s not how it works with this guy,” said Sam Fiorani, vice president of global vehicle forecasting at Auto Forecast Solutions, of Trump. “The administration has to comfort everyone by adamantly stating that there will be no tariffs on automotives before anyone can get comfortable.”

A ‘step back from the edge’ for Detroit

Don’t tell that to Wall Street because the market reacted with glee Monday morning on the news, pushing the stock prices of all three Detroit automakers higher.

Dan Ives, Wedbush Securities global head of Technology Research and managing director and senior equity analyst, told the Free Press that investors believe the auto sector likely “is out of the woods for now.”

“This is all a game of high-stakes poker and Trump knows the massive implications this would have on the auto sector in the U.S.,” Ives said in an email. “The Big 3 auto stalwarts have clearly communicated the message to the White House and it appears to be working. Huge step back from the edge for the 313 auto industry.”

Here’s where tariffs stand: Trump has increased tariffs on goods imported from China to 20%. He has imposed tariffs of 25% on Canadian and Mexican goods, but has exempted auto industry companies that are compliant with the United States-Mexico-Canada Agreement from the tariffs until April 2. Earlier this month, he announced a 25% tariff on steel and aluminum imports from all countries, which will impact carmakers. Many countries have responded with imposing retaliatory tariffs on goods coming from the United States.

Trump said he supports tariffs, which are taxes paid by importers on goods when they cross a border, to encourage countries to halt illegal immigration and keep fentanyl out of the United States. He has also said tariffs will spur manufacturers to add more U.S. production. 

In the case of cars, the Detroit automakers are already operating most of their plants at full capacity and as Ford CEO Jim Farley has said his company will not be building new plants in the states anytime soon, citing the billions of dollars it costs to build a new factory and the years it requires.

Canada happy to hear the news

One Local UAW leader told the Free Press Monday, “My instant reaction to this news would be, OK great for the auto industry. Now hopefully all the other industries can get Trump onboard so that they won’t be destroyed either.”

This union leader asked to not be named because he is not authorized to share his opinion publicly on the president’s policies.

In the meantime, Ford and GM have been hustling autos and parts across the Canadian border as quickly as possible ahead of potential 25% tariffs on April 2. Unifor, the union that represents Canada’s autoworkers, has been helping them and was relieved to hear the news Monday.

“That is obviously fantastic news,” John D’Agnolo, president of Unifor Local 200 and chair of the Auto Council for Unifor, told the Free Press Monday. “There were thousands and thousands of jobs in jeopardy. I’m quite pleased (Trump) was able to look at the impact it would have. I know the automakers were laying out the complexity of it all so he could understand how it all works across the three nations.”

Unifor Local 200 represents some 2,000 workers at Ford’s Essex Engine and Windsor Engine plants in Windsor, Ontario. It provides the engines that power Ford’s bestselling F-Series pickups, which are built in Dearborn, Kentucky and Ohio. D’Agnolo said just one truck full of 45 Ford engines used in the popular Super Duty pickup would cost Ford about $70,000 in tariffs if Trump imposts a 25% tariff on Canada and does not exempt autos.

D’Agnolo said his union is still helping push as many engines out of the plants and onto trucks to get them to the states as fast as possible to help Ford. He said he’s seeing vehicles coming into Canada from the states at a rapid pace too — all of it is an attempt to get as much product over borders in the event Trump does decide to impose the 25% tax. He believes this latest news indicates that Trump will permanently exempt tariffs on autos, at least “for now.”

More: Canada’s autoworker union helping push Ford engines, GM vehicles over border ahead of tariffs

“Things could change as we all know, but I’m believing that he recognized, with all the work that’s being done to show him, the damage to the industry,” D’Agnolo said. “I’m sure he wouldn’t know every aspect of the industry and how it runs on all three borders.”

A bad move politically

Sam Abuelsamid, vice president of market research at Telemetry Insights, said he expects Trump will exempt autos from broad tariffs.

“Over the last couple of months, the automakers have been lobbying aggressively to find their way around these tariffs,” Abuelsamid said. “The negative economic impact of these tariffs would be huge. They may be realizing from a political standpoint it would do more harm than good to have these tariffs, from the job losses to the spike in inflation.”

Fiorani said April 2 can’t come soon enough so that there is clarity for the industry.

“Uncertainty in the auto industry is detrimental to the way they do business,” Fiorani said. “Not knowing how much it’s going to cost to bring  a part across next month or next year really throws a problem in their budgets and this is not an industry that makes a lot of money relative to the outpouring of investment.”

When the automakers make decisions on North American production it is for the long term, he said. The industry appreciates the value of free trade between the United States, Canada and Mexico so, “suddenly putting a tariff in there is not going to change the production location of any part or vehicles because it takes too much time to do that. They cannot react on a sudden whim.”

More: Auto dealers, UAW local leaders brace for layoffs amid tariff war: ‘Writing’s on the wall’

This is a developing story.

Todd Spangler and Jackie Charniga contributed to this report.

Jamie L. LaReau is the senior autos writer who covers Ford Motor Co. for the Detroit Free Press. Contact Jamie at jlareau@freepress.com. Follow her on Twitter @jlareauan. To sign up for our autos newsletter. Become a subscriber.