By Gavin Bade and Alex Leary

WASHINGTON -- Automakers will get a one-month reprieve from tariffs on Mexico and Canada for cars that comply with a free-trade agreement between those two nations and the U.S., the White House said Wednesday.

The move follows a request from the heads of Ford Motor, General Motors and Stellantis, White House press secretary Karoline Leavitt said, and would apply to autos imported through the U.S.-Mexico-Canada Agreement, or USMCA, the successor trade deal to 1994's North American Free Trade Agreement.

A group that represents the three automakers, the American Automotive Policy Council, in a statement thanked President Trump and said the companies would work with the administration "on our shared goals of increasing US automotive production and expanding exports."

The tariff exemption applies not only to Detroit-based automakers, but to any cars from Canada and Mexico that comply with the trade deal, an administration official said. The auto-maker group has said its imports from those countries qualify as tariff-free under USMCA rules.

Trump is also open to additional tariff exemptions such as those he granted to carmakers, Leavitt said while acknowledging that tariffs could cause some economic disruptions.

The delay offers a weekslong respite for industry executives who were attempting to mitigate the fallout from hefty tariffs on vehicles and parts. The tariffs could add between $3,000 and $10,000 to the cost of each car and pickup truck sold in the U.S., analysts estimate. And the 30-day reprieve doesn't erase the threat posed by the bevy of potential tariffs floated by the administration -- a risk that triggered months of contingency planning among automakers and suppliers.

Leavitt said: "The American people elected this president to have monumental reform and change, including rebuilding our manufacturing base in this country, standing up to foreign nations who have been ripping off our country for decades, and that requires a little bit of disruption."

Trump on Tuesday imposed 25% tariffs on Canada and Mexico, and an additional 10% tariff on China, rattling markets and sparking frantic negotiations between the U.S. and its continental neighbors.

Canada had responded to the U.S. tariffs with plans to impose 25% tariffs on about $100 billion of U.S. imports, and Mexico's president said it would also retaliate, with a range of moves that were expected to be announced Sunday. China on Tuesday announced retaliatory tariffs on U.S. agricultural goods, and other measures against American companies.

Major corporations such as Target and Best Buy warned of consumer price increases as a result of the duties, imposed because of what Trump says is the role that Canada, Mexico and China play in the fentanyl trade. But Leavitt batted away any anxiety over the tariffs.

"I think for folks on Wall Street who may be concerned, look at what this president did for you in his first term. Wall Street boomed. Stock market boomed. The president expects that to happen again," Leavitt said. "But most importantly, Main Street is going to boom."

Earlier on Wednesday, Trump appeared to shut the door on any tariff relief for Canada, saying he told Prime Minister Justin Trudeau in a recent call that he hasn't seen enough action on curbing the flow of fentanyl.

"He said that it's gotten better, but I said, " 'That's not good enough, ' " Trump wrote on Truth Social on Wednesday. "The call ended in a 'somewhat' friendly manner! He was unable to tell me when the Canadian Election is taking place, which made me curious, like, what's going on here? I then realized he is trying to use this issue to stay in power."

Trudeau, who announced his decision to step down in January, has described Trump's criticism about drugs as unjustified, saying that fentanyl seizures at the U.S. northern border have dropped to "near zero."

Leavitt didn't specify other sectors where Trump might be open to exemptions. But she said he wasn't likely to give carve-outs for future tariffs, such as the so-called reciprocal trade action scheduled for April 2, which will aim to equalize U.S. tariffs with the duties and nontariff barriers charged by other nations.

"The reciprocal tariffs will go into effect on April 2, and he feels strongly about that no matter what, no exceptions."

She said Trump told the auto executives to "get on it," and start investing in the U.S.

Auto executives have said that the tariffs on Mexico and Canada would upend intricate factory networks and supply chains that have been knitted together over three decades. Added costs from the taxes would wipe out much or all of profits from companies such as GM, analysts have said, and jeopardize thousands of parts suppliers.

Executives from GM, Ford and Jeep maker Stellantis have been urging the administration over the past week to grant exemptions for companies that comply with USMCA.

To qualify for tariff-free border crossings under USMCA, a vehicle must contain a certain percentage of parts that were made in North America, or face a 2.5% tax. The Detroit automakers have said they comply with the trade pact's rules.

Write to Gavin Bade at gavin.bade@wsj.com and Alex Leary at alex.leary@wsj.com

(END) Dow Jones Newswires

March 05, 2025 17:27 ET (22:27 GMT)

Copyright (c) 2025 Dow Jones & Company, Inc.