President Donald Trump has signed an order The prices on the American neighbors of Canada and Mexico, as well as China, from Tuesday. Canada and Mexico quickly announced reprisal rates, while China said it would take “necessary countermeasures”.
The company between North American nations now exceeds China, totaling $ 1.8 billion in 2023. It was much higher than the trade of $ 643 billion that the United States made with China the same year.
Trump said economic emergency on Saturday to place duties of 10% on all imports from China and 25% on imports from Mexico and Canada. Energy imported from Canada, including oil, natural gas and electricity, would be taxed at a rate lower by 10%.
Here are some imported goods whose prices can be affected first:
A “pomegranate” launched in automotive production
For decades, automotive companies have built supply chains that cross borders of the United States, Mexico and Canada. According to S&P Global Mobility, more than one of the cars and light trucks sold in the United States. In 2023, the United States imported a value of 69 billion dollars of Mexican cars and light trucks – more than any other country – and $ 37 billion in Canada. Additional $ 78 billion in automotive parts came from Mexico and $ 20 billion in Canada. The engines of the Ford F-Series microphones and the emblematic Mustang Sports Coupé, for example, come from Canada.
“You have motor engines and seats and other things that go through the border several times before entering a finished vehicle,” said Scott Lincicome, commercial analyst at Libertarian Cato Institute. “You have American parts that go to Mexico to be placed in vehicles which are then returned to the United States.
“You throw 25% of prices in all of this, and it’s just a grenade. ”
China is also a large supplier of automotive parts in the United States
In a report Tuesday, S&P Global Mobility said that “importers are likely to pass most, if not all, of this increase (cost) of consumers”. The time when the new average car is already for $ 50,000 and the average used car for $ 26,000, according to Kelley Blue Book.
Higher pump price
Canada is by far the largest foreign supplier in American oil America. From January to November from last year, Canada has shipped the gross value of US $ 90 billion, ahead of Mexico No. 2 to 11 billion dollars.
For many American refineries, there are not much choice. Canada produces the “raw oil type that American refineries are intended to treat,” said Lincicome. “It is a heavy raw. All hydraulic fracturing and all the oil and gas that we do here in the United States – or most – are a lighter crude than many American refineries do not treat, especially in the Midwest. ”
Among the tariffs on Canadian oil imports, Lincicome said: “How does the devil is shaking?” I guess it just shakes through higher gas prices, especially in the Midwest. ” The economic TDs believe that Trump prices could increase the prices of American gasoline from 30 to 70 cents the gallon.
Computers, clothes and toys
China prices could have an impact on a wide variety of consumer goods on which Americans depend. Mobile phones, computers and other electronic devices were among the main imports of China last year, according to data from the Commerce Department.
The United States has also imported more than $ 32 billion in “toys, games and sports articles” from China last year, the data shows.
And Americans import billions of dollars a year into China’s clothes. This includes more than $ 7.9 billion in shoes last year, according to data from the Commerce Department.
Problem in Margaritaville
The prices could increase the price of those who increase a glass of tequila or Canadian whiskey.
In 2023, the United States imported $ 4.6 billion from Tequila and $ 108 million from Mezcal from Mexico, according to the distill Spirit of the United States, a commercial group. The United States has imported a value of $ 537 million in Canadian spirits, including 202.5 million dollars in whiskey.
Canada and Mexico were also the second and third importers of American spirits in 2023, behind the European Union, the Council said.
The Council said that the United States is already faced at a price of 50% potentially devastating on American whiskey by the European Union, which is expected to start in March. The imposing prices in Mexico and Canada could stack even more reprisal action in the industry.
Chris Swonger, president and chief executive officer of the Council, said that he appreciated the objective of protecting American jobs. But tequila and Canadian whiskey – like Kentucky Bourbon – are designated as distinctive products that can only be manufactured in their country of origin.
“In the end, the prices on the spiritual products of our neighbors in the north and south will injure American consumers and lead to job losses in the American hotel industry, just as these companies continue to recover from The pandemic, “said Swonger.
Dear lawyers, just in time for the Super Bowl
For American consumers still exasperated by high prices of grocery store, a trade war with Canada, Mexico and China could be painful. In 2023, the United States bought more than $ 45 billion in agricultural products in Mexico, including 63% of imported vegetables and 47% of fruit and nuts. Agricultural imports from Canada reached $ 40 billion. A 25% price could increase prices.
“Grocery stores work on very tiny margins,” said Lincicome. “They cannot eat the prices … especially when you talk about things like lawyers who, essentially all – 90% – come from Mexico. You talk about Guacamole prices just before the Super Bowl. ”
American farmers are also nervous that Canada and Mexico will retaliate by slapping prices on American products such as soy and maïs. This is what happened in the first Trump administration. China and other Trump prices targets retaliated by targeting supporters of the president in rural America. Exports of soybeans and other agricultural products have dropped, so Trump spent billions of money from American taxpayers to reimburse farmers for lost sales.
“President Trump was as good as his word,” said Mark Mchargue, a central city, Nebraska, a farmer who grows corn, soy, popcorn and pigs. “It removed the bite. That’s sure. “But he would prefer to see the government push to open foreign markets to American agricultural exports. “We prefer to get our market money,” said Mchargue, president of Nebraska Farm Bureau. “It doesn’t feel good to get a government check.”
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The writers of the Associated Press Josh Boak in Washington, Dee-Ann Durbin in Detroit and Alan Suderman in Richmond, Virginia, contributed this story.