| Thanks for reading Hyperdrive, Bloomberg’s newsletter on the future of the auto world. Read today’s featured story in full online here. Just hours after taking effect, President Donald Trump’s 25% tariffs on imported cars already are reverberating around the globe. Jeep maker Stellantis plans to temporarily halt some production in Canada and Mexico. Ford began offering steep discounts to keep customers coming to showrooms. And Volkswagen told dealers it will tack on import fees to the vehicles it ships to the US. The moves show the immediate fallout from car tariffs that took effect shortly after midnight in Washington. The levies are expected to upend supply chains and add thousands of dollars in costs to most vehicle models.  Volkswagen told dealers it will tack import fees on to sticker prices in the US. Photographer: Krisztian Bocsi/Bloomberg The implementation followed Trump saying the US would impose a 10% tariff on every country that exports to the US, plus additional duties targeting about 60 nations. Although imported cars and parts are exempt from those so-called reciprocal tariffs, carmakers are already reeling from Trump’s escalating trade war. “While the sector may feel it just dodged a bullet, we remain concerned that vehicle and parts tariffs are here to stay and will add a substantial cost burden,” Bernstein analyst Daniel Roeska said in a note to clients. Certain auto parts will also be hit by an equivalent levy no later than May 3 under a plan Trump announced last week. The US will also keep existing 25% tariffs on Canada and Mexico, and an exemption for goods that comply with the free trade agreement between the countries will remain indefinitely, officials said. Those levies were initially imposed to urge action to curb the flow of fentanyl. The countries would switch to the new tariff regime if those initial levies are lifted, officials said. Car buyers have been rushing to US showrooms to lock in deals before potential price hikes from the levies. That drove March sales to a seasonally adjusted annualized rate of about 17.8 million vehicles, the highest since April 2021, according to JP Morgan analyst Ryan Brinkman. But as that supply runs out, automakers are bracing for significant potential cost increases and supply chain turmoil. Auto executives continue to lobby the administration to limit the fallout, with Ford, GM and Stellantis focusing their efforts on excluding certain low-cost car components from the tariffs. Ford said Thursday it was rolling out discounts on almost its entire lineup as a way to keep car buyers coming into its showrooms.  Ford Bronco SUVs at a dealership in Los Angeles last month. Photographer: Eric Thayer/Bloomberg Ford’s “From America, For America” discount program, which runs through June 2 and includes an employee-pricing-for-everyone deal, is reminiscent of the “Keep America Rolling” promotion GM offered after the terrorist attacks of Sept. 11, 2001, which jump-started US auto sales in the midst of a bleak economy. Industry executives have said they support Trump’s goal to build more vehicles in the US and expand the country’s manufacturing base. But moving auto assembly plants will take years, and may never happen for cash-strapped parts suppliers. Stellantis said it will pause production at its Windsor, Ontario, plant for two weeks beginning Monday, citing uncertainty around tariffs. The company will also idle its Jeep plant in Toluca, Mexico, and the moves will affect employees at several US powertrain and stamping facilities. About 900 workers across all affected sites will be temporarily laid off, a Stellantis spokeswoman said. “With the new automotive sector tariffs now in effect, it will take our collective resilience and discipline to push through this challenging time,” Antonio Filosa, chief operating officer for the Americas, said in a memo to employees. “We are continuing to assess the medium- and long-term effects of these tariffs on our operations, but also have decided to take some immediate actions.”  Stellantis’ Windsor Assembly Plant in Ontario. Photographer: Emily Elconin/Bloomberg Toyota has halted overtime work at its plant in Guanajuato, Mexico, for the time being in response to the tariffs, said Alejandro Rangel, head of the SITIMM union that represents workers at auto suppliers in central Mexico. The plant makes Tacoma hybrid pickups and exports most of its production to the US. Honda is holding talks with workers to reduce or cancel overtime for the next six weeks at its assembly plant in the same state that makes HR-V crossovers largely for export, Rangel said. Mercedes-Benz production chief Jörg Burzer said Thursday the carmaker is considering making more vehicles in the US in response to the tariffs. The company is also weighing whether to pull its least-expensive models, such as the GLA midsize SUV, from the US market because the levies would make those vehicles economically unfeasible. “We’re still assessing the impacts of these tariffs,” Burzer said on the sidelines of a company event in Stuttgart, Germany. “We have made some plans, but flexibility is absolutely key.” Volvo Car CEO Håkan Samuelsson pledged to increase the number of cars the company builds in the US and move another model to its South Carolina factory. The Swedish carmaker “will have to look closely” at which model it will add to production lines, he told Bloomberg News in an interview Thursday.  A protester and Cybertruck driver arguing at a rally outside a Tesla showroom in Columbus, Ohio, on March 29. Photographer: Brian Kaiser/Bloomberg The race for EV market dominance is constantly changing. While Teslas are now being hawked from the White House lawn in the US, China seems to have taken an unassailable lead. Electric-car giant BYD recently announced a battery that can be charged to go 400 kilometers in just five minutes, and Chinese automakers increasingly are moving into emerging markets. Listen to the latest edition of Bloomberg Green’s Zero podcast for a breakdown of the latest trends in the EV world. Subscribe on Apple or Spotify so you never miss an episode. | 
