DETROIT — The aftershocks from President Donald Trump's "reciprocal" tariffs have reverberated around the globe as trade partners unveiled retaliatory tariffs, stock market indices plunged and automakers announced plant shutdowns and other production changes.

Tariffs of 25% on vehicles imported into the United States began being collected Thursday, and "Liberation Day" duties of at least 10% on dozens of countries start Saturday. The president insists they will spur economic growth from boosted U.S. production, new factories and more well-paying manufacturing jobs. But economists have warned that the widespread nature of the levies could send the country into a recession, with Michigan bearing a disproportionate share of the burden.

"The Trump tariff slate announced yesterday will be viewed as a black swan event for the auto industry," Daniel Ives, analyst at investment firm Wedbush Securities Inc., said Friday in a note to investors. "The 25% tariff on autos and auto parts from outside the U.S. will change the paradigm for the U.S. auto industry for years to come if the current tariffs stay in place."

During a tour of storm-damaged northern Michigan on Thursday, Gov. Gretchen Whitmer said the effects of the tariffs unleashed by Trump worry her.

“I’m concerned about the impact on the economy and schools,” Whitmer said at a Meijer grocery store in Alpena.

The Dow Jones Industrial Average on Thursday had its largest wipeout since 2020, down nearly 4%. The S&P 500 and Nasdaq were down an even larger percentage. Automotive stocks also sank: General Motors Co. closed down 4.3%, Ford Motor Co. down 6%, Stellantis NV down 9.4%, Tesla Inc. down 5.4% and Toyota Motor Corp. down 5.2%. Markets continued to slide on Friday.

Immediate foreign responses were minimal, though Canadian Prime Minister Mark Carney announced 25% tariffs on vehicles imported into Canada from the United States.

“The global economy is fundamentally different today than it was yesterday,” Carney said in a speech. “If the United States no longer wants to lead, Canada will.”

"Uncertainty" has been the buzzword among business leaders when it comes to decision-making. A lack of confidence in how long these tariffs will remain in place or unchanged is not the kind of environment companies need to make billion-dollar decisions around production footprint, investments and job creation.

“One thing is certain: There is no certainty,” Martin Fiore, a tax expert with the firm Ernst & Young, said during a webinar.

If uncertainty and whiplash have marked the rollout of Trump's new trade policies, the auto industry's varied actions following the auto tariffs taking effect may appear just as chaotic. Stellantis NV on Thursday said it's temporarily shutting down assembly plants that make minivans, muscle cars and some Jeep SUVs in Windsor and Toluca, Mexico, affecting feeder plants in Michigan and Indiana.

General Motors Co. said it's adding production at its full-size truck assembly plant near Fort Wayne, Indiana, hiring hundreds of temporary workers. A Mercedes-Benz Group AG executive told Bloomberg it's considering making more vehicles in the United States and weighing whether to pull its least expensive cars like the GLA small SUV from the U.S. market.

Meanwhile, Ford Motor Co., already the largest manufacturer of vehicles in the United States, is offering thousands of dollars in discounts to customers, prioritizing sales of non-tariffed inventory on the ground at dealers. Ferrari NV has said it'll raise prices.

Trade groups like the Michigan Manufacturers Association raised concerns about the tariffs' economic implications.

"Our concern for Michigan’s broad manufacturing base, which employs over 600,000 Michiganians, is the reality of a worldwide economy served by a supply chain that is fully integrated and operating like a fine-tuned, yet fragile, instrument," John Walsh, CEO of the Michigan Manufacturers Association, said in an email to members. "We welcome the growth of investment in U.S. manufacturing the president hopes for, and some of which he announced, but caution that the time it takes to increase capacity and build new plants will take years.

"That period of time between tariffs today and investment to come," he continued, "will have a dramatic impact on manufacturers, their employees, our communities and the state of Michigan."

Congressional backlash

Some Republicans on Capitol Hill — a group that has increasingly fallen in line with Trump’s demands — have started to push back on tariffs.

Republican U.S. Sen. Chuck Grassley of Iowa introduced a bill Thursday that would require congressional approval of all new tariffs within 60 days to prevent them from expiring. He did so jointly with Democratic U.S. Sen. Maria Cantwell of Washington.

The night before, four Republican senators joined Democrats in supporting a resolution to nix Trump’s current 25% tariff on Canadian goods that don't comply with the United States-Mexico-Canada trade agreement that Trump signed in 2020.

Those four were Rand Paul of Kentucky, Susan Collins of Maine, Lisa Murkowski of Alaska and former Senate Majority Leader Mitch McConnell of Kentucky.

“With so much at stake globally, the last thing we need is to pick fights with the very friends with whom we should be working to protect against China’s predatory and unfair trade practices,” McConnell said in a statement.

The resolution passed 51-48 but is not expected to receive a vote in the U.S. House.

Most Republican members of Michigan’s congressional delegation have remained quiet on Trump’s tariffs over the past week, while Democrats have condemned them repeatedly.

“The business community here is freaking out. I have gotten so many texts and emails today just saying, like, 'We don't know what this is going to look like; we're already stretched so thin on our margins,'” U.S. Rep. Hillary Scholten of Grand Rapids said in a phone interview.

She added: “The Farm Bureau is deeply impacted. They are already in such uncertain territory right now, not having a Farm Bill. This is going to have huge, huge implications for farm equipment. We're working on an effort to try to get a carve-out for our defense manufacturing base as well.”

Foreign response

Canadian Prime Minister Carney said the nation will match Trump's 25% auto tariffs. The Trump administration on Thursday began collecting 25% tariffs on imported vehicles, including on previously duty-free vehicles compliant with the USMCA.

“The system of global trade anchored on the United States that Canada has relied on since the end of the Second World War — a system that, while not perfect, has helped to deliver prosperity for our country for decades — is over,” Carney said.

He added: “The competitive threat in North America is from Asia, not within North America."

The United States' 25% duties on certain auto parts are expected to take effect by May 3, though components compliant with the USMCA initially will be excluded. The list of parts published Thursday includes engines, bodies, suspensions, tires, lithium-ion batteries, steering wheels, brake hoses, hinges, turn-signal flashers and more.

Eventually, vehicles and auto parts will only be tariffed based on their non-U.S. content once the government has the needed processes in place.

Carney says U.S. auto parts exports to Canada won't face a tariff, because of the benefits of an integrated auto sector between the countries.

"Canada is protecting its own manufacturing," said Sam Fiorani, vice president of global vehicle forecasting at AutoForecast Solutions LLC. "A lot of the share of parts being built in Windsor and Cambridge and Woodstock come across the border from the U.S. Excluding those parts makes perfect sense."

Canada has imposed tariffs on billions of dollars of U.S. goods already, including U.S. steel and aluminum, appliances, liquor and more. Carney, who faces an election later this month, said those will remain in place.

Elsewhere, French President Emmanuel Macron called on companies to pause investments in the United States, while Japanese officials said there would be repercussions. Several other countries, such as Mexico, India and South Korea, initially held off on retaliations or threats and indicated they wanted to negotiate with the administration.

India is weighing its options, having "ongoing talks" in hopes of a trade deal, according to a Reuters report.

European Union officials have said that as soon as mid-April, they will target as much as $28 billion worth of American goods with tariffs of up to 50%. The tariffs could affect key U.S. exports like whiskey and motorcycles.

China pledged to fight back and called the tariffs "bullying." The Asian nation has hit back on escalating tariffs. Trump previously added a combined 20% on China, which has announced duties of up to 15% on imports such as U.S. coal, crude oil, farming machinery, wheat and corn.

Mexico has taken a softer approach thus far. President Claudia Sheinbaum has said her country wouldn't respond tit-for-tat, but is planning a "comprehensive program," according to Reuters.

Automakers reveal playbooks

The automotive sector didn't stay silent about the new 25% tariffs on vehicles imported into the United States, revealing new bits of the playbooks they've said they've been developing since hearing about potential tariffs.

Stellantis said starting Monday, Ontario's Windsor Assembly Plant that produces the Chrysler minivan and electric Dodge Charger Daytona muscle car would idle for two weeks, and Mexico's Toluca Assembly Plant, which makes the Jeep Compass crossover and electric Jeep Wagoneer S SUV, would shut down for a month.

The production stoppages also trigger about 900 temporary layoffs at a number of U.S. parts plants operated by the automaker, including a pair of Michigan stamping plants, in Warren and Sterling Heights, and a few facilities around Kokomo, Indiana. An engine shortage is also expected to shut down Warren Truck Assembly Plant's production of the Jeep Wagoneer and Grand Wagoneer SUVs for four weeks.

"With the new automotive sector tariffs now in effect, it will take our collective resilience and discipline to push through this challenging time," Antonio Filosa, the company’s chief operating officer for the Americas, wrote in an email to employees. "But we will quickly adapt to these policy changes and will protect our company, maintain our competitive edge and continue delivering great products to our customers."

The automaker’s announcement drew strong responses from unions in both the United States and Canada. United Auto Workers President Shawn Fain accused the company of playing games with workers’ lives.

"As we’ve shown time and again, they’ve got the money, the capacity, the product, and the workforce to employ thousands more UAW members in Michigan, Indiana, and beyond,” he said in a statement.

Lana Payne, the president of Canada's auto union Unifor, said the Windsor plant shutdown would affect 4,500 of her union’s members there, plus more at regional suppliers to the plant.

“Unifor warned that U.S. tariffs would hurt auto workers almost immediately, and in this case, the layoffs were announced before the auto tariff even came into effect,” Payne said in a statement. “Trump is about to learn how interconnected the North American production system is the hard way, with auto workers paying the price for that lesson.”

Crosstown rival GM, meanwhile, said it was increasing production of Chevrolet Silverado and GMC Sierra pickup trucks at its assembly plant near Fort Wayne, Indiana. The move will add roughly 250 full-time temporary workers, part-time temps and about 10 additional vehicles produced per hour at the three-shift plant, according to United Auto Workers Local 2209's shop chairman.

Wedbush Securities estimates the tariffs will add $5,000 to $15,000 to the price of a vehicle. Ives said "no one" is a winner with even Tesla, which manufactures all of its EVs for the U.S. market in the United States, supplying materials and major components for its batteries from other countries.

"Every auto maker in the world will have to raise prices in some form," Ives said. "The concept of this auto tariff in our view would be a back breaker and Armageddon for the auto industry globally and throws the supply chain into pure panic mode. We believe this adds up to $100 billion of costs annually to the auto industry and will essentially get passed directly onto the consumer."

But Ford, for now, says otherwise. The Dearborn automaker on Thursday introduced a "From America, For America" campaign, offering discounts equivalent to its "A Plan" employee pricing through June 2 that can save customers roughly $2,000 to $10,000 on the purchase of a new vehicle at a cost lower than what dealers pay to get the vehicle on their lot. The program is meant to instill certainty for consumers in an environment that lacks it and promote sales of the nontariffed inventory already on retail lots.

Further auto industry fallout in the weeks ahead could include an uptick in lawsuits involving automakers, suppliers and overseas manufacturers.

Vanessa Miller, a Detroit attorney with Foley & Lardner LLP who chairs the firm's automotive team and often works with suppliers, said tensions over contractual language that often doesn’t even mention tariffs — and who must pay for them — is rising.

Miller said the typical message suppliers are sending to their customers is: "We cannot absorb the cost of these tariffs, and we're going to need to talk about price increases because we can't sustain these tariffs for any period of time, given our narrow profit margins."

So far, automakers largely have responded by requesting a grace period from suppliers, asking that they keep shipping parts until the full impact and details of the tariffs are known. But disputes could escalate quickly, she said.

"The nuclear option is to threaten stop-ship, saying we're not going to ship you product unless you proactively agree to pay these tariffs," Miller said. And if that happens, the automakers are likely to respond by asking a judge to intervene.

_____

(Detroit News Washington bureau chief Melissa Nann Burke and Staff Writer Francis X. Donnelly contributed to this story.)

_____

©2025 www.detroitnews.com. Visit at detroitnews.com. Distributed by Tribune Content Agency, LLC.