Trump Signals New 25% Tariffs on Cars, Pharma and Semiconductors

US president Donald Trump has unveiled plans for the next stage of his protectionist trade strategy, proposing tariffs of around 25% on imports of cars, pharmaceuticals and semiconductors — with the possibility of further increases later this year. 

Speaking at a press conference on 18 February, Trump said auto tariffs would be “in the neighbourhood of 25%”. He added that similar rates would apply to pharmaceuticals and chips, and could rise “very substantially” over time. More details are expected on 2 April, when a review into other countries’ tariff policies concludes, potentially triggering reciprocal measures. 

Trump indicated there may be a delay to allow companies to shift production to the US, reiterating that goods manufactured domestically would not face tariffs. 

The proposals could significantly affect key US trading partners. Mexico and South Korea are heavily exposed through car exports, while Malaysia and Singapore are vulnerable in semiconductors. India’s pharmaceutical sector, which counts the US as its largest market, also faces risk — as does Ireland, now the biggest exporter of pharmaceutical products to the US following a sharp rise in transatlantic trade. 

The announcement follows confirmation of a 25% US tariff on steel and aluminium imports. UK business and trade secretary Jonathan Reynolds warned the move could have negative consequences for both countries, noting that Britain supplies specialised steel products to the US that are not easily sourced elsewhere. 

With further clarity due in early April, businesses worldwide are bracing for renewed disruption to global trade. 

If you are looking to understand better how Trump’s tariffs will impact UK businesses, join us at our next International Trade Forum on US Tariffs on the 17^th March. Register here.