The most recent tariff for US President Donald Trump in the auto sector showed one clear thing, as experts say: The United States is no longer a beacon for free market trade, and companies need to turn into the reality of “America first”.

On Wednesday, Trump announced 25 percent customs tariff On Thursday on all cars, light trucks and imported car parts in the United States, an expert is a “destroyed” step for the industry.

Nearly half a car was imported in the United States last year at a total value of more than $ 330 billion, according to news reports, quoting Goldman Sachs.

It is not clear whether the definitions will enter into force as shown in the latest Trump advertisement or whether there will be exceptions or any decline.

“But one thing we know is certainly,” said Ilhan Gkel, the chief economist in Anderson Economic Group (AEG), said that “Trump’s policies are fever, not the free market and free trade in the way the United States has done. [things] For decades. Now this turns. … this is the new rule, and companies must play accordingly and will have to increase the trade presence in the United States. “

Some auto manufacturers, including Hyundai and Kia in South Korea, have announced plans to enhance production in the United States.

Although this gives the impression that Trump is right to say that the definitions will force manufacturers to produce more in the United States, the full image is more complicated.

“The United States is in fact the best in terms of market size,” and it represents approximately 25 percent of global auto sales, explaining why car manufacturers do not want to lose access to the American market.

But the reason why a lot of manufacturing has moved from the United States is to benefit from low prices and cheaper commodities.

He said that the re -manufacturing to the United States would lead to a high prices of its products, which amounts to demand.

“The prices will increase significantly, and it will have an indirect effect,” said Jikil.

He said: “It will become a vehicle worth 50,000 dollars, a vehicle ranging from 75,000 to 80,000 dollars within two years, and the high prices there will remain forever.”

Jikil said that this will eventually lead to job losses, unlike Trump’s declared goal of protecting American workers.

According to previous estimates by AEG, the tariff proposals of Trump in February will raise the price of a car collected in the United States, Canada and Mexico from $ 4000 to $ 10,000 for most vehicles and 12,000 dollars or more for electric cars (EVS)

The estimate did not include an effect Revenge definitions Other countries may be imposed.

In addition, Trump’s tariff of 25 percent on steel and aluminum, which was kicked on March 12, is expected to increase the prices of traditional engine vehicles by 250 to 800 dollars and that of EVS by $ 2500 or more.

AEG said that the measures revealed on March 26 will be “more expensive” for European and Asian cars that were manufactured than their previous appreciation and perhaps more expensive or less expensive for the vehicles produced by North America.

“It is possible that the effects of definitions will be important in our industry – which affects automotive, suppliers, merchants and customers,” said the CEO of Ford Jim Farley on Friday. The warning gave although about 80 percent of Ford vehicles sold in the United States are locally assembled.

Integrated industry

One of the reasons why automatic definitions have a widespread impact is that the industries of different countries are very intertwined.

In North America, American and Canadian auto industries have been widely incorporated since the signing of the 1965 agreement that facilitated the movement -exempt and spare parts movement, said David Adams, President and CEO of Global Auto Industry companies in Canada.

This was followed by free trade agreements in 1989 and 1994 that linked the industries of the two countries and Mexico employees in a closer way.

Over the years, the three countries have built specialties for some car parts, partially driven by costs, Adams said.

For example, the Canadian dollar is usually less than the US dollar, and since Canada has a system of public health care, employers usually do not have to afford health insurance costs for their workers, which makes the cheapest doing some business in Canada on the United States.

For a car made in Canada, half of the parts of the United States will come, and for the other in Mexico, 30 percent to 35 percent of its parts will be from the United States on average.

Adams told Al -Jazeera: “Through the tariff of Canadian vehicles, it effectively targets American suppliers,” Adams told Al -Jazeera.

Since Canada and Mexico – and all other countries that the latest definitions apply – are likely to lack, the prices will surely occupy more.

Adams said: “We do not want to cut our nose to behave our face, but what we look at everyone hurts … Because of the high degree of integration, the effect will be the same degree on both sides.”

Definitions on car parts, which do not apply to components that are considered “US content”, make things more complicated.

In car production, raw materials are usually converted into a component in one judicial state before they are folded in a larger component or ingredients elsewhere. It is common to cross the boundaries three to five times per vehicle.

In practice, this means that the burden of customs tariffs may vary greatly for different companies and different vehicles.

“He is very confusing and complex,” said Adams.

“It seems that Trump’s desire is not to have a Canadian car sector. But this will cost $ 50 billion to $ 60 billion to transfer everything to the United States. This is not a short -term proposal. We are ultimately looking for a long -term solution that does not create stability not only in the auto sector but in the northern US economy, so we can focus on doing business.”

Adams said that this solution should include Mexico because the global competitive car industry needs a low -cost area to implement the most dense parts of the employment in the manufacturing process.

“Part of the current challenge is that [Trump] “Looking at the auto industry from the point of view of the car sector as an American industry, not the North American industry,” he said.

In addition to the uncertainty suspended on this sector, Trump’s pledge to impose a “mutual” tariff on all countries and specific duties on Canada and Mexico because of their alleged failure to stop the flow of fentanel and immigrants who are not documented to the United States.

Brett House, a professor of economics at the University of Colombia, said that some of the Trump -backed logical basis depends on “wrong” information, given that a little fentian flows from Canada to the United States.

“The so -called White House data is completely wrong,” House told Al -Jazeera Island, adding: “This shows that these definitions were never about these things.”