U.S. delays decision on auto tariffs by 6 months

U.S. President Donald Trump on Friday announced that he will delay by six months a decision on imposing steep tariffs on imported autos while the U.S. pursues talks with key trading partners.

“Within 180 days… the Trade Representative shall update me on the outcome of the negotiations,” he said in a proclamation issued by the White House.

Mr. Trump had been facing a Saturday deadline to announce whether to implement 25% punitive duties on autos — a possibility that has worried the European Union (EU) and Japan in particular, as well as Mexico and Canada. While delaying what would be a sizeable escalation in Mr. Trump’s multi-front trade wars, the decision leaves hanging the threat of tariffs — a move sure to irritate major trading partners already angered by the imposition of punishing U.S. duties on steel and aluminum.

The EU, Canada and Mexico have already slapped stinging duties on American exports like motorcycles, orange juice, whisky and blue jeans in response.

Negotiations expected to resolve the impasse with the EU will now occur with the backdrop of Mr. Trump’s auto tariffs threat.

In his proclamation on Friday, Mr. Trump described the U.S. auto sector as facing decline due to unfair foreign competition.

A report by Commerce Secretary Wilbur Ross concluded that America’s shrinking share of the auto market jeopardised its research, development and manufacturing — all “vital to national security.”

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