US hints at possible tariff carve-outs for car industry

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US commerce secretary Howard Lutnick has indicated that some sectors may be “left out” of tariffs imposed on Canada and Mexico, sending shares in carmakers higher. 

Lutnick said President Donald Trump was considering which sectors could potentially be given some relief from the 25 per cent tariffs, which took effect on Tuesday. An announcement was due later in the day, he told Bloomberg on Wednesday. 

The commerce secretary added that the administration was looking at compliance with the 2020 US-Mexico-Canada trade agreement’s rules of origin, including for automakers.

This week’s tariffs are particularly significant for the carmaking sector, which often shifts components between the three countries during the production process.

Shares in General Motors jumped 5.6 per cent in pre-market trading while Ford was up 2.4 per cent. Shares in Milan-listed Stellantis climbed 8 per cent.

Lutnick added that the US planned to renegotiate the three-country trade deal next year.

This is a developing story