The Wall Street Journal reported last night that Trump was deliberating on reducing his 145 percent tariffs on China, potentially lowering them to 50 percent, a report that seemed to calm anxious investors. This report gained traction as Trump hinted at reductions during an earlier press event that day, stating: “145% is too high. It will come down substantially.” Yet, Treasury Secretary Scott Bessent refuted the WSJ report the next morning, asserting that the U.S. would not reduce tariffs unilaterally. “This is akin to an embargo, and breaking trade between the two countries doesn’t benefit anyone,” he informed the press.

Nevertheless, within a few hours, the Financial Times reported that Trump was, in fact, planning to retract his recently-imposed tariffs on steel, aluminum, and car parts imported from China. The White House shortly after confirmed to CNBC that some unilateral exemptions were indeed being considered. Although this was not a full reversal — a 25 percent tariff on foreign-made cars and a 25 percent tariff on all imported car parts would remain — this stance would provide some relief to carmakers facing the challenge of handling the cost of multiple tariffs layered upon each other.

Alas, more confusion ensued. Shortly after the FT report was published, and automotive stocks started trending upwards from the news, Trump told reporters in the Oval Office that Canada — not China — might see auto tariffs further increase. “They took a large percentage of the carmaking, and I want to bring it back to this country,” he said. “I really don’t want cars from Canada. So when I put tariffs on Canada — they’re paying 25 percent, but that could go up in terms of cars — when we put tariffs on, all we’re doing is saying, ‘We don’t want your cars, in all due respect, we want really to make our own cars,’ which is what we’re doing in record numbers.”

The chaotic jumble on auto tariffs is the latest incidence of the Trump administration vacillating on who they are tariffing, what they are tariffing, and how much those tariffs are. But even if new proposed exemptions are “destacked” from the current tariffs, as officials characterized it to the Financial Times, the tariffs in their existing form threaten to devastate the American auto industry. In a letter sent to the administration on Tuesday, a coalition of powerful U.S. auto industry players cited a Center for Automotive Research report which estimated that a 25 percent auto tariff would increase costs to the industry by up to $107 billion.

“Tariffs on auto parts will scramble the global automotive supply chain and set off a domino effect that will lead to higher auto prices for consumers, lower sales at dealerships and will make servicing and repairing vehicles both more expensive and less predictable,” the coalition wrote.