US Secretary of Commerce Howard Lutnick has hinted at updates to the Trump administration's tariff policies against Canada and Mexico that could come on Wednesday, which could provide exemptions to compliant companies. American automakers Ford (F), General Motors (GM), and Stellantis (STLA) — known as the Big Three — could be among those to benefit from these tariff exemptions.
Yahoo Finance Washington correspondent Ben Werschkul assesses the latest news on President Trump's tariff policies. In his address to a joint session of Congress on Tuesday night, Trump stated that Americans should expect "a little disturbance" in relation to the impacts tied to trade tariffs.
To watch more expert insights and analysis on the latest market action, check out more Catalysts here.
This post was written by Luke Carberry Mogan.
US Commerce Secretary Howard Luttnik, teasing an update to tariffs on Canada and Mexico, which could come as soon as this afternoon. Saying that companies who are compliant with the US Mexico Canada agreement could be exempt from a portion of that 25% tariff. Here with more, we've got Ben Worshkol. And Ben, I was so excited to talk to you about this because Luttnik gave us kind of a peek into the negotiation handbook this morning, saying if you're USMCA compliant, you might be exempt. Talk to me about what that means and how we can use that knowledge to suss out who else might be exempt.
Right, for sure. Yeah, I mean, the number one sector here that appears to be kind of looking for some relief is autos. That's, this is a reference to what's called automotive rules of origin, which is written into USMCA basically to acknowledge that auto, that a car is is is a lot of time kind of simultaneously built across multiple countries. It'll go back and forth across the US Mexico border. Um and what Luttnik was talking about this morning was potentially allowing the the rules of that USMCA to go forward on that. So that would be a big concession for the automotive auto industry which has been screaming about this frankly ever since Trump talked about blanket tariffs on the US and Canada. The larger context point I'd make too is that everything Trump is doing right now in terms of Canada and Mexico is an exception. The way the agreement is written is that there's there's all these kind of works out for different regions and then, but with the USMCA, you can kind of get around it by going national security. And that's what Trump has done. He's sort of declared national economic emergency around the fentanyl and illegal migration and then essentially driven a huge truck through that to create a blanket exception to essentially the entire deal. So this is they've already sort of accepted in one massive direction and now they're talking about going back. And I think that's emblematic of Trump kind of hearing things when the economic pain gets too acute. Another example I'd point to for folks is kind of an example is oil. As he, as in the run-up last month to the Canadian tariffs, it became clear that the oil sector would be really damaged, especially the oil sector in the United States, which is very reliant on Canadian oil. So he carved out an exception there, and right now the duties there are 10%. So it's kind of, the message is getting through to a certain extent. We'll see what the parameters of this deal, Trump sounded different about this frankly last night in the State of the Union. He talked about how being fine with a little quote little disruption. So we'll see what the parameters of this are, but they're Luttnik and Co are clearly trying to create sort of a carve out where the pain for US economy is is most acute.
Yeah, but I guess the question is, is he actually okay with a little bit of pain? And how closely is he watching some of the reaction that has played out in the stock market over the last couple of days? Of course, there's lots of talk about a Trump put and what exactly that is, and whether or not he is paying close attention to the stock market's recent moves. Jason Furman, I asked him that just about an hour ago, and he said he actually isn't paying as close attention as he did during his first administration. I'm curious what you think about that.
Yeah, I mean, I think Trump is very, very consistent on this. It's sort of, I guess it's a question of when markets are going to finally believe him. He says he's very fine with this. He believes in tariffs, his, you know, his line about tariffs being the most beautiful word in the dictionary, it's kind of, it's fun to say, but I think it's emblematic of what he wants. And he was again clear about it last night. He believes in in putting in tariffs for the sake of tariffs. This isn't a negotiation in a lot of ways. This is about doing this. And Luttnik was even clear about this this morning. He says April 2nd they're going to have kind of a massive wave of reciprocal tariffs. So I think Trump is clearly saying he's fine with some pain and he's shown willingness to have that. The question is who kind of gets to him and which sectors are most impacted and can maybe kind of find a carve out for themselves. But I think broadly speaking, I would agree with Jason Furman's point that this, there's a difference here between Trump 1.0 and 2.0 and that he really, really believes in tariffs down to his sort of, down to his core, based on everything he says not just last night but for years now.
