Trump’s chaotic tariffs have gone into effect—well, partially. To briefly recap, 25% tariffs now exist on almost all imports from Mexico and Canada, with an additional 10% on imports from China and 25% on steel and aluminum imports. However, following lobbying by the Big Three, Trump granted a one-month reprieve for the industry to work out logistics, including how most automakers have plants in Mexico, Canada, or both.
So, in April, analysts believe that a third of vehicle production could halt within a week. Plants cannot be relocated within that time, and that says nothing of the effects of Canada and Mexico’s retaliatory tariffs. Trump also suggested, “You know, the tariffs could go up as time goes by.”
We previously questioned why Fain, whose union did not endorse Trump, was quick to hop aboard this tariff train, so let’s explore further.
The UAW’s stance: A month ago, the UAW declared that it “supports aggressive tariff action to protect American manufacturing jobs.” More recently, the union called the tariffs “necessary” and “a powerful tool in the toolbox for undoing the injustice of anti-worker trade deals.” Fain further revealed that UAW is “in active negotiations with the Trump Administration about their plans to end the free trade disaster.” He added, “We look forward to working with the White House to shape the auto tariffs in April.”
UAW Comms Director Jonah Furman is backing up Fain, who told ABC News, "Tariffs are an attempt to stop the bleeding from the hemorrhaging of jobs in America for the last 33 years.” Also, "NAFTA sucks.”
Wait, wasn’t the North American Free Trade Agreement replaced? Yes. Trump previously replaced NAFTA with the United States-Mexico-Canada Agreement (USMCA). In doing so, the White House promised, “USMCA will replace the terrible NAFTA agreement that resulted in the loss of millions of American jobs.” USMCA went into effect on July 1, 2020. Does Trump now want to undo his own 2020 trade agreement? Perhaps.
Does Fain believe what he’s selling on tariffs? It appears consistent with his union’s “long-standing opposition to free trade” and globalization. Yet several UAW members expressed fears to progressive publication WSWS, which lambasted Fain for being “oblivious to the impact on autoworkers.” One worker also accused Fain of climbing into the GOP’s pocket and chasing political clout.
Wait until you see what’s next…
Another wrinkle: Over the weekend, Fain headlined a Bernie Sanders “Fight Oligarchy” rally attended by 6,000+ people. In doing so, Fain called out the “billionaire class,” including a high-profile member of Trump’s administration, who he declares is working against the “working class.” Could this harm negotiations between the UAW and Trump? It remains to be seen.
The takeaway: Anticipated tariff effects include swift 20% vehicle price hikes, and analysts wonder why Trump chose blanket tariffs on all goods rather than targeting specific products while investing in infrastructure.
For example, Honda announced plans to shift production to the U.S., but this could take years to achieve, and Trump has not publicly offered any assistance in making this happen sooner. So, unless something changes, it’s not looking great for auto industry jobs in April, and there’s zero way to predict what, or even if, Trump and Fain will “negotiate” in the interim, no matter what bluster we hear from Fain and other union presidents.