In another twist, the automotive industry may soon see relief on tariffs imposed on imported vehicles and parts after President Donald Trump said Monday that companies need more time to set up more U.S. manufacturing.

"I'm looking at something to help some of the car companies," Trump told reporters in the Oval Office. "They're switching to parts that were made in Canada, Mexico and other places, and they need a little bit of time, because they're going to make them here."

Possible relaxation of at least some auto tariffs is a good sign and could limit price increases, according to experts, amid fears that demand for new vehicles will fall because of tanking consumer confidence. The apparent policy reversal is another example of the instability created by Trump's trade policies that executives and politicians are decrying because it makes the decision-making that Trump seems to be demanding rife with challenges.

“The pressure release is needed now,” said Glenn Stevens, executive director of MICHauto, the automotive arm of the Detroit Regional Chamber. He added, however: “They need certainty on policy, and they need more than a little more time. We need to focus on a stronger USMCA. This region can be globally competitive and must be globally competitive.”

Estimates for the 25% tariffs on imported vehicles that went into effect earlier this month and 25% on auto parts set to take effect May 3 put the cost of the duties in the tens of billions of dollars. Relaxation of those import taxes could help ensure the continued flow of parts and production of vehicles, benefit already financially distressed suppliers and limit costs passed onto consumers.

During a speech at the Detroit Economic Club on Monday, Michigan Gov. Gretchen Whitmer advocated for using federal dollars already held by the U.S. Energy Department to benefit suppliers.

“It is really hard to understate how much harm the current economic strategy will cost tier two and tier three businesses,” Whitmer said, referring to businesses that provide parts and materials for other suppliers.

Automotive stocks shot up following Trump's comments. General Motors Co. and Ford Motor Co.'s shares were rising more than 4% in the early afternoon, and Stellantis NV's were up around 3% on the New York Stock Exchange. Shares in all three closed higher on the day.

Trump in late March announced the 25% auto tariffs, citing Section 232 of the Tariff Expansion Act on the grounds of national security and the need for a strong domestic supply chain. There are concerns that Chinese companies increasingly have used Mexico as a middleman to ship goods into the United States duty-free, including after the United States-Mexico-Canada trade agreement was signed in 2020.

Trump has insisted the tariffs will increase U.S. production, create well-paying manufacturing jobs and increase federal revenues to lower taxes and pay off national debt. But economists and the auto sector have warned the comprehensive tariffs could be debilitating for the industry overall, especially given the supply chain is so interconnected, particularly with Canada and Mexico.

"Just another day of chaos and uncertainty," David Whiston, analyst at investment services firm Morningstar Inc., said in an email, "but at least it’s potentially good news. Long term though as policy stands now the administration still wants the automakers to move more capacity to the U.S. and that will cost billions."

It also will take time. Retooling a plant can take a year or two. Building a new plant can take easily three years, which by then would be nearing the end of Trump's second term when he constitutionally is required to leave office. Capacity to move or increase production immediately is limited, as a component being produced in the United States would have to be identical to that being made elsewhere. Not to mention, the country already has a skilled trades shortage.

Entities ranging from automakers to the United Auto Workers, which has supported the use of tariffs to increase U.S. manufacturing, and Canadian political leaders is that it would be better to reopen discussions on USMCA than face on-again, off-again tariff decisions. The trade agreement had a deadline of 2026 already in place for the three countries to renegotiate USMCA.

Already there have been production disruptions from tariffs. Stellantis last week began idling for two weeks its Windsor Assembly Plant in Ontario that produces Chrysler minivans and Dodge electric muscle cars and for this month at its Toluca Assembly Plant in Mexico that makes the Jeep Compass and electric Wagoneer S crossovers. That prompted the temporary layoffs of 900 autoworkers at feeder plants in Michigan. The company said it's assessing the impact of the levies.

GM said last week it was increasing full-size truck production at Fort Wayne Assembly in Indiana. It also announced temporary job cuts at an electric vehicle plant in Detroit and Hamtramck and a temporary idling of an electric commercial van plant in Ontario, though that was attributed to market dynamics.

Companies across the industry also are evaluating cutbacks on costs and production, Stevens added.

If relief focuses on auto parts, as Trump suggested in his comments Monday, it could look more like the automotive duties Canada last week imposed on U.S. vehicle imports in retaliation to Trump's auto tariffs. The levy applies to finished vehicles that don’t comply with USMCA, as well as the non-Canadian and non-Mexican content of autos that do comply with the deal. Auto parts also are not tariffed.

Although Trump characterized the auto tariffs as "permanent, 100%" when he announced them, his Monday remarks weren't completely unexpected, Stevens said. Companies, trade associations and the Michigan congressional delegation, he said, all have been advocating for a reevaluation of the autos tariffs.

"They're listening," Stevens said about the Trump administration. "This is a good sign."

Trump also has put forth and pulled back on import taxes multiple times since taking office. He delayed 25% tariffs on Canada and Mexico to March from February and then granted exemptions to goods compliant with USMCA. Last week, he announced a 90-day pause on higher "Liberation Day" tariffs over 10% on some 75 countries that had offered to negotiate with the administration.

Trump on Monday also touted exclusions from 125% tariffs on China and the 10% baseline global tariff granted for consumer electronics as beneficial for tech giant Apple Inc., which manufactures iPhones in China.

"Look, I'm a very flexible person," Trump said in response to a journalist's question. "I don't change my mind, but I'm flexible. And you have to be. You can't just have a wall. ... Sometimes you have to go around it, under it or above it."

Meanwhile, credit rating agency S&P Global Inc. issued a forecast saying the auto tariffs and 25% tariffs on steel and aluminum could increase the prices of vehicles — which already have been approaching $50,000 average transaction prices — by 5% to 10%. It estimated that could decrease U.S. new vehicle sales to 15.2 million to 15.5 million for 2025 and 14.8 million to 15.1 million for 2026 compared to prior estimates of 15.7 million to 16 million.

"Based on these updates, we believe there is a greater likelihood there could be negative rating actions or outlook revisions," S&P Global Ratings credit analyst Nishit Madlani said in a statement.

S&P's long-term credit rating for GM and Stellantis is BBB, which is lower medium grade, and Ford's is just below at BBB-, which is one notch above junk bond status.

Regarding offering exceptions on tariffs to products like consumer electronics, Trump on Monday added: "I don't want to hurt anybody."

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