Trump grants 1-month tariff exemption to US automakers, Canadian energy imports may get relief

US President Donald Trump will grant American automakers a one-month exemption from his newly imposed 25% tariffs on Canadian and Mexican vehicle imports, the White House announced Wednesday, temporarily easing concerns in the auto industry and helping Wall Street rebound from its sharpest decline in nearly three months.

The tariffs, which took effect Tuesday, remain in place for other industries, but Trump is open to considering additional exemptions, the White House said.

The temporary relief helped auto stocks recover, with General Motors shares rising 7.2% and Ford climbing 5.8% on Wednesday.

Trump may also consider lifting the 10% tariff on Canadian energy imports, including crude oil and gasoline, if they meet the United States-Mexico-Canada Agreement (USMCA) rules of origin, reported Reuters, citing people aware of the matter.

However, the US president reiterated that he would not back down from his stance on tariffs, linking them to efforts to curb fentanyl smuggling from Canada and Mexico.

Following a call with Canadian Prime Minister Justin Trudeau, Trump suggested he remained unconvinced about Canada’s efforts to stop fentanyl shipments.

“He said that it’s gotten better, but I said, ‘That’s not good enough,’” Trump wrote on Truth Social. “The call ended in a ‘somewhat’ friendly manner!”

Fentanyl, a synthetic opioid, is responsible for tens of thousands of US overdose deaths annually. While most of the drug enters through the southern border, US officials argue that Canada and Mexico serve as transit points for illicit shipments.

The tariffs could stall Canada’s economic recovery, given its heavy reliance on US trade, which accounts for 75% of its exports.

Trudeau, who is in the final days in the office, has resisted lifting Canada’s retaliatory tariffs while any US levies remain in place.

“We’re not interested in meeting in the middle,” Canadian Finance Minister Dominic LeBlanc told the Canadian Broadcasting Corporation. “Canada wants the tariffs removed.”

On Tuesday, the Trump administration imposed sweeping tariffs on Canada, Mexico, and China, prompting immediate retaliatory measures and sending financial markets into turmoil.

The tariffs have sparked political backlash in Canada. Some provinces, including Manitoba, banned the sale of American liquor in response.

Canadian Foreign Minister Mélanie Joly dismissed the temporary nature of the exemption, saying they are going to go “through this psychodrama every 30 days.”

“There’s too much unpredictability coming from the White House.”

Trump is expected to announce a new round of tariffs on April 2, which he has described as “reciprocal” measures to match those imposed by trading partners. While details remain unclear, the move could escalate global trade tensions further.