Trump announces 25% tariffs on foreign-made vehicles

Investing.com -- U.S. President Donald Trump announced a 25% tariff on all foreign-made cars and light trucks on Wednesday. Automobiles made in the U.S. will be exempt. The tariff goes into effect on April 2nd.

“What we're going to be doing is a 25% tariff on all cars that are not made in the United States... business is coming back to the United States so that they don't have to pay tariffs... This will continue to spur growth like you haven't seen before,” Trump commented.

Trump expects automakers worldwide to flock to the U.S. to build their cars. Earlier this week, Hyundai (OTC:HYMTF) announced a $20 billion investment in the U.S., including $5.8 billion for a new steel plant in Louisiana, creating nearly 1,500 jobs.

The administration said the tariffs are expected to generate $100 billion in new tariff revenue for the country.

Trump said he would ask Congress to pass a bill to make interest payments for cars made in the U.S. tax deductible.

Shares of General Motors Company (NYSE:GM) and Stellantis NV (NYSE:STLA) fell over 3% on Wednesday on expectations of the announcement. Ford Motor (NYSE:F) traded flat, and Tesla Inc (NASDAQ:TSLA) fell over 5%.

Elsewhere, foreign automakers like Toyota Motor (NYSE:TM), Honda Motor (NYSE:HMC), and Ferrari NV (NYSE:RACE) fell anywhere from 2 to 5% in intra-day trading Wednesday.