Subaru was slow out of the blocks when it came to adding EVs to its lineup, but now it’s wondering whether to even bother trying to catch up to rivals. The automaker revealed this week it was “re-evaluating” its electrification strategy amid a turbulent and uncertain time for the auto industry.

Also: Subaru Trailseeker Is Faster Than A WRX But No One Knows If It’s A Wagon Or SUV

Look at Subaru’s US website and you’ll find just one EV: the recently facelifted Solterra. A second, the Outback-sized Trailseeker that made its debut at last month’s New York Auto Show, is scheduled to be added to the range for 2026. But we’re unlikely to see many more EVs join it any time soon.

Tariffs and Tax Credits: The Great Unknowns

Aside from a general concern about a slowdown in the rate of EV takeup, Subaru, like every other automaker, is hamstrung by a lack of clarity from the US regarding its long term position on both import tariffs and EV tax credits. Nobody knows what the tariff situation will look like six or 12 months from now or whether tax credits will be scrapped or not.

Subaru estimates Trump’s tariffs could cost it $2.5 billion this year because, although the company does have a plant in Indiana, it only builds around half of the 700,000+ cars the brand sells in the US each year, Auto News reports. The remainder have to be imported, an d while Subaru could theoretically push the US plant’s current 345,000-unit annual capacity to 500,000, its supplier base can’t handle more than 370,000 units without a major upgrade.

Overseas Production and Shifting Plans

That means the Trailseeker will probably have to be built overseas, Auto News suggesting production will take place north of Tokyo. Subaru also had planned to create a new EV-only plant, but is rethinking that strategy, too. It now says it might have to add combustion vehicles into the mix at the new site.

Subaru execs made the admissions while announcing the company’s fiscal year financial results that revealed operating profit had dipped 13 percent to $2.7 billion. Global sales dropped 4.1 percent to 936,000 vehicles and North American deliveries slid 4.1 percent to 732,000 vehicles, though sales in Japan did climb 5.4 percent to 104,000.

In the wake of the US-China trade war, Tesla temporarily halted shipments of parts from China to the US. However, with both countries now agreeing to a 90-day truce and significantly reducing their respective tariffs, Tesla is looking to resume the import of critical components from China. Elon Musk may want to keep this news under wraps from President Trump, though, as his stance on tariffs is far from favorable.

Read: Tesla’s CyberCab Promises 300-Mile Range with Surprisingly Small Battery

An unnamed inside source told Reuters that Tesla will start shipping Cybercab and Semi parts from China at the end of this month. The electric automaker will reportedly start trial production of the Cybercab in October before moving ahead with mass production in 2026. Tesla has grandiose ambitions for the Cybercab and is betting on hundreds of thousands of units being sold in the US, forming the core of its long-awaited robotaxi service.

As the electric car maker gears up for production, many details about the Cybercab remain under wraps. What is known, however, is that the vehicle will be a compact, two-seater, completely eliminating the traditional steering wheel and pedals. Tesla is keeping specifics to a minimum, but early reports suggest the Cybercab will feature a battery pack smaller than 50 kWh, yet still offering an impressive range of approximately 300 miles (483 km).

Progress on the Tesla Semi

Production of the Tesla Semi officially began in late 2022, but progress has been slow. Full-scale production is expected to kick off next year at a new factory adjacent to the existing Gigafactory in Nevada, which will significantly expand Tesla’s production capabilities.

While Elon Musk and President Trump have found common ground on many issues in recent months, tariffs remain a notable point of disagreement. Trump has famously called tariffs “the most beautiful word to me in the dictionary,” yet Musk has long championed free trade. In fact, according to Reuters, he urged Trump to lower tariffs, though he ultimately left the decision in the President’s hands.

One of the unanticipated consequences of the tariffs was their negative impact on domestic production. Tesla’s CFO, Vaibhav Taneja, noted that the tariffs hurt the company’s US investments, as the company had to import equipment from China to expand its local production lines.

Treasury Secretary Scott Bessent prepares to testify before the Senate Finance Committee during his confirmation hearing in the Dirksen Senate Office Building on Capitol Hill on Jan. 16, 2025 in Washington, D.C.  (Photo by Chip Somodevilla/Getty Images)

The United States and China agreed Monday to lower steep tit-for-tat tariffs for 90 days, temporarily cooling a trade war but still leaving a cloud of uncertainty over businesses in the world’s two largest economies.

American and Chinese officials announced the pause will go into effect Wednesday, following talks in Geneva, Switzerland, as negotiations on a final deal continue. U.S. markets rallied following the announcement.

U.S. tariffs on Chinese goods will drop to a universal 10% baseline, down from the 145% President Donald Trump imposed last month. Trump’s previous 20% emergency tariffs announced in February on all products because of illicit fentanyl chemicals from China will remain in place, as will protective tariffs on goods still in place from the president’s first term. New duties on small packages sent to the U.S. from China, valued at less than $800, will also remain.

Fentanyl discussion

Treasury Secretary Scott Bessent said Monday that he and Chinese counterparts “had a very robust and highly detailed discussion” on preventing fentanyl and the chemicals to make the synthetic opioid from entering the U.S.

“The upside surprise for me from this weekend was the level of Chinese engagement on the fentanyl crisis in the United States. They brought the deputy minister for public safety,” Bessent said.

Bessent told reporters that overall negotiations were “always respectful.”

“We had the two largest economies in the world. We were firm — and we moved forward … We came with a list of problems that we were trying to solve and I think we did a good job on that,” Bessent said.

The White House touted the 90-day pause as a “landmark deal” in a Monday press release.

China has agreed to lower its tariffs on U.S. goods to 10%, down from 125%, according to a joint statement.

Tariffs are taxes on goods coming across the border. Companies and small businesses that import items from China must pay them to the U.S. government to receive their purchases.

Business reaction unclear

“I see the president’s approach to this as him putting a knife in your back and then pulling it out an inch and calling it a win,” said Alex Duarte, senior economist at the Tax Foundation, a think tank that advocates for lower taxation.

“Depending on the good, the rate could be close to 55%, so the tariffs on China are still pretty high. It’s hard to say how businesses are supposed to react to this because there’s so much uncertainty and the president behaves very erratically,” Duarte told States Newsroom Monday.

States Newsroom spoke to several business owners who were extremely nervous ahead of Trump’s April 2 “liberation day” tariffs. That announcement sent markets plummeting.

Marcus Noland, executive vice president and director of studies at the Peterson Institute for International Economics, said in an interview Monday the situation has “gone from OK to apocalyptic to bad.”

“It’s clearly preferable to a tariff that would have essentially ended trade between the two countries, but it’s still significantly more restrictive than where we started the year,” Noland said.

The White House released a statement Monday saying the administration will continue “working toward a rebalancing” of a trade deficit with China. In 2024, the U.S. purchased $295.4 billion more in goods from China than China purchased from the U.S.

“Today’s agreement works toward addressing these imbalances to deliver real, lasting benefits to American workers, farmers, and businesses,” according to the White House press release.

A pharmacy manager retrieves a bottle of antibiotics. (Photo by Joe Raedle/Getty Images)

WASHINGTON — President Donald Trump signed an executive order Monday aimed at lowering drug prices by pressuring pharmaceutical companies to align their U.S. pricing models with those in similarly wealthy countries.

“We’ll slash the cost of prescription drugs and will bring fairness to America,” Trump said at a morning White House event. “We’re all gonna pay the same.”

The executive order, which the White House dubbed the “most-favored-nation” policy, gives pharmaceutical companies 30 days to negotiate lower drug prices with the government.

If no deal is reached in that time, Trump said a new rule will be set so that the United States will have a price model similar to the lower rates patients abroad pay. According to the executive order, Health and Human Services Secretary Robert F. Kennedy Jr. would be responsible for the rulemaking  “to impose most-favored-nation pricing.”

“We are going to pay the lowest price there is in the world,” Trump said.

Prescription pricing for brand-name drugs in the U.S. is more than four times higher than in similar countries, according to a 2024 study by the nonpartisan research nonprofit RAND.

Clear price targets

A White House official previewing the policy in a background call with reporters Monday said the president will direct the Department of Commerce to “take all appropriate action” on countries that “suppress drug pricing abroad.”

The Food and Drug Administration will also consider expanding imports of pharmaceutical drugs from nations beyond Canada, the White House official said.

Former President Joe Biden issued an executive order to direct the FDA to work with states to import prescription drugs from Canada.

The White House official said Kennedy “will set clear targets for price reductions across all markets in the United States.”

Kennedy appeared at the White House alongside the president Monday morning.

“The United States will no longer subsidize the health care of foreign countries, which is what we were doing,” Kennedy said. “If the Europeans raise their price of their drugs by just 20%, that is tens of trillions that can be spent on innovation and the health of all people all across the globe.”

Trump said Monday the drug pricing policy would be included in the “one, big, beautiful,” reconciliation bill that is the top priority of congressional Republicans. The measure is also expected to provide tax cuts and a significant funding increase to border security.

Staff on the House Energy and Commerce Committee told reporters twice during a background briefing around the same time that most favored nation prescription drug pricing would not be in that reconciliation package.

First term

The order is similar to an effort the president made in his first term, which was struck down in federal court.

The White House official said Monday’s order is an expansion of those first-term efforts, which tried to apply the pricing model for those with Medicare – the health insurance program for those who are 65 or older and certain people under 65 who have disabilities – to 50 drugs.

“The expectation should not be that we will just be pursuing that same rulemaking,” a White House official said. “We have moved on from that for broader action.”

The pharmaceutical industry has long opposed such a move and is already bracing for the president’s planned tariffs on prescription drugs. 

More details on specific actions in Medicare will be announced later, according to a White House official.

“We will be taking action in the Medicare program if the pharmaceutical companies do not come to the table and lower their prices across markets,” the White House official said.

Effort unserious, leading Democrat says

U.S. Senate Finance Committee ranking member Ron Wyden, Democrat of Oregon, slammed Monday’s executive order.

“If Trump was serious about lowering drug prices, he would work with Congress to strengthen Medicare drug price negotiations, not just sign a piece of paper,” Wyden said.

The Inflation Reduction Act that Democrats passed along party lines in 2022 when they held unified control of Washington allowed for drug negotiating pricing that aims to lower drug costs for those with Medicare.

“Democrats took on Big Pharma and won by finally giving Medicare the power to negotiate lower drug prices on behalf of seniors and capping their out-of-pocket costs for expensive prescriptions,” Wyden said, referring to the law.

Jennifer Shutt contributed to this report.

Main Street in the Wisconsin community of Cambridge. (Photo by Henry Redman/Wisconsin Examiner)

As a former small business owner for 27 years and a longtime board member of the Monroe Street Merchants Association in Madison, I’ve spent decades working to strengthen the small businesses and Main Streets that make our communities thrive. Today, I’m deeply concerned — because Main Streets across America are under threat like never before.

The sweeping tariffs imposed by the current administration are already fueling inflation, disrupting supply chains, and pushing small businesses to the brink. Local retailers, independent producers and small manufacturers — the very backbone of our neighborhoods — are being hit hardest.

Carol “Orange” Schroeder, our board chair at the Monroe Street Merchants Association and owner of Orange Tree Imports, a favorite Madison store, understands this better than most. This year, Orange is celebrating 50 years in business — an incredible milestone. Over the decades, she’s helped independent retailers nationwide weather many challenges, including fierce online competition. But as she recently wrote, not even the pandemic has matched the level of economic turmoil small businesses are facing today.

The problem is clear and devastating: suppliers can’t get the goods they need, vendors are questioning whether they can stay afloat and customers — grappling with rising prices and financial anxiety — are pulling back from shopping locally. Sales reps are going unpaid as orders are canceled, and stores of all sizes are bracing for empty shelves. In short, the social fabric that binds our communities is beginning to fray under the weight of uncertainty.

The National Retail Federation recently warned that these tariffs threaten the American dream — and they’re right. Small businesses aren’t just part of our economy; they’re central to our national identity, job creation, innovation and the strength of our local communities.

Now more than ever, Congress must step up and act. Policymakers have a critical opportunity to end these harmful tariffs, restore stability, and reassert balance in our trade policies. Just as importantly, Congress must reassert its constitutional authority over the power of the purse — a responsibility that rests with the legislative branch, not the executive alone.

The stakes couldn’t be clearer. Without immediate action, we face shuttered storefronts, lost jobs and an avoidable recession. According to Gallup, Americans’ economic outlook is now worse than at the height of the COVID-19 pandemic or the global financial crisis — a sobering indicator of just how fragile the moment is.

This is not a partisan issue. It’s a matter of economic survival, community resilience and protecting the American dream for generations to come.

Congress must act now. Small businesses, workers, and families across the country are counting on bold leadership. It’s time to end the tariff chaos, restore stability, and ensure Main Street can keep doing what it does best: creating jobs, driving innovation and strengthening the communities we all call home.

GET THE MORNING HEADLINES.

SUBSCRIBE

White House Deputy Chief of Staff Stephen Miller and press secretary Karoline Leavitt speak to reporters at the White House briefing on May 1, 2025. (Photo by Ashley Murray/States Newsroom)

WASHINGTON — Despite news that the U.S. economy has contracted since January, White House Deputy Chief of Staff Stephen Miller said Thursday that President Donald Trump’s policies are working to “unleash this era of American prosperity.”

Miller, also a top adviser for Trump on immigration, dismissed fears from the small business community and American consumers when pressed by reporters during the final in a series of press briefings marking Trump’s first 100 days.

Questions centered on Trump’s steep 145% tariffs on any goods, including manufacturing parts, imported from China, as well as baseline 10% tariffs on products brought into the U.S. from nearly every other country.

Tariffs are an import tax paid to the U.S. government by American companies and individuals who purchase goods from abroad. A broad consensus among economists is that those costs are passed to consumers.

When asked what the administration’s end goal is for its trade war with China — the nation now charges 125% tariffs on American products entering its borders — Miller said “we need to have a trade relationship with China that does not do harm to our nation’s economic and national security.”

“At the same time, tariffs will bring significant revenue into this country that will allow us to pursue our dramatic plan of tax cuts and reforms,” he said, referring to the massive budget reconciliation package underway in the Republican-led House and Senate.

Tariff order, then a pause

Trump initially triggered much higher rates on products from major trading partners — for example, 20% on European Union goods and up to 46% on products from Vietnam — but paused them for 90 days at a baseline 10% after investor panic erased trillions from the U.S. stock market. The administration maintains it will have new trade agreements in place by the July deadline.

The Institute for Supply Management’s April manufacturing report cited tariff concerns and an “unknown economic environment” for the manufacturing sector’s second month of contraction.

Department of Commerce figures released Wednesday showed the U.S. gross domestic product — a country’s total value of goods and services — decreased at an annual rate of 0.3% since January, the first time GDP dipped into the negative since the first quarter of 2022.

Meanwhile, U.S. consumer sentiment saw its steepest percentage decline over a three-month period since the 1990 recession, according to the University of Michigan’s April survey of consumers.

Tax plans

In response to an inquiry about a U.S. Chamber of Commerce plea for small business tariff relief, Miller said Thursday, “The relief for small businesses is going to come in the form of the largest tax cut in American history.”

At the heart of congressional Republicans’ massive budget reconciliation package is the extension of Trump’s 2017 tax law. Wholesale extending the 2017 Tax Cuts and Jobs Act is expected to reduce federal revenue by roughly $4.5 trillion over a decade. And, depending on how or if lawmakers pay for the tax cuts, the costs could shrink the economy in the long run, according to the Committee for a Responsible Federal Budget’s analysis of Congressional Budget Office figures.

Miller said Trump’s promise to businesses to revive and expand 100% expensing for business investments in the U.S. will make it “the most pro-small business tax bill in American history.”

House and Senate Republican leaders have indicated differing timelines for final passage of the tax deal — varying from Memorial Day to July 4.

Business community worries

An April 30 letter from the Chamber of Commerce to the administration warned of “irreparable harm” to small businesses, even if the administration strikes new tariff agreements over the next weeks or months.

“The Chamber is hearing from small business owners every day who are seeing their ability to survive endangered by the recent increase in tariff rates,” the letter stated.

Three Republican senators broke with the GOP Wednesday night and voted to rebuke Trump on tariffs. The largely symbolic measure ultimately failed after Republican opposition.

Treasury Secretary Scott Bessent told reporters Tuesday the administration is in conversations with 17 trading partners but would not give any details on talks with China.

Economists are now awaiting Friday’s “all-important” jobs report for any further snapshot of U.S. economic health, as Mark Zandi of Moody’s Analytics wrote Sunday on X.

“If payroll jobs increase by 150k, give or take, which is the consensus, all the weak economic data released during the week will be forgotten, at least for a bit. Fingers crossed. If employment increases by less than 100k, watch out,” he wrote.

An engineer works at a cargo port storage yard. Tariffs imposed by President Donald Trump have generated uncertainty about the economy for many businesses and consumers, according to economic forecasters. (Photo by Vithun Khamsong/Getty Images)

Over a buffet lunch Wednesday, a roomful of bankers got a mixed picture of the national economy in the short term. For Wisconsin, the longer term outlook appears more certain, although there may be little comfort from that.

Speaking at an economic forecast luncheon hosted by the Wisconsin Bankers Association and the news outlet WisBusiness, part of WisPolitcs.com, Dale Knapp, director of research at Forward Analytics, reviewed the persistent demographic slump that has put Wisconsin on a troubling trajectory for the coming decades.

That trajectory has been evident already for some 20 years, Knapp said, and it centers on the population bulge from baby boomers — people born between 1946 and 1964. That generation was 65% more numerous than the group born in the previous 19-year period, he said. And the subsequent generations have been about 20% smaller in number or even less.

The baby boom produced an explosion of demand for everything from toys to homes to schools and universities, Knapp observed. Now the last of that generation is passing into retirement, and with smaller populations in the generations that follow there are “worker shortages all across the state,” Knapp said.

Between 2020 and 2040, the working age population, ages 18 to 64, is projected to fall by 15% on average in all but six Wisconsin counties, Knapp said. Automation may pick up the slack in some industries, including manufacturing and possibly fast food service, he suggested.

Immigration is another remedy, Knapp said — but also “a challenge given what’s going on in the White House now.”

“We need to fix the border problem to a degree,” Knapp said. “If you do that, then maybe you can get the two parties in Washington together and say, ‘OK, we need to fix legal immigration by expanding it.'”

Knapp’s other proffered solution is to invest funds to offer families $16,000 to move to Wisconsin from out of state. With 3,000 families a year, the money could be repaid with the added income and sales tax revenues, “and we could fund it forever,” he said.

National economic uncertainty

Outlining the current state of the nation’s pocketbook and its near-term forecast, economist Andrea Sorensen of US Bank in Minneapolis said that the economy “is actually doing probably better than most people think.”

That’s despite the uncertainty that has ballooned since President Donald Trump took office in January, she said. That uncertainty also looms over the horizon, however.

The nation’s Gross Domestic Product (GDP) — the broadest measure of the overall economy — has been growing by more than 2% over the last couple of years through the end of 2024.

Data issued Wednesday morning showed GDP shrank 0.3% in the first quarter. Sorensen said that was for an unusual reason, however.

U.S. businesses stocked up on goods from overseas to get ahead of the tariffs Trump imposed after taking office, she said. She attributed the slight first-quarter dip to those imports, because their value is subtracted from GDP.

The GDP estimate released Wednesday is the first of three that will be produced for the quarter, and Sorensen said her economic team believes the next two estimates will be better.

She views other indicators as relatively favorable.

The national labor market remains strong. Month-to-month employment growth has cooled some since the hiring spikes that followed the economic crash from the COVID-19 pandemic.  Still, “we still consider it to be quite healthy,” she said.

“People who have jobs have money to spend,” Sorensen said. “So as long as the labor market is holding up, we think the economy could be OK.”

Consumer spending also remains strong, she said, even though surveys show dramatic declines in both consumer and business confidence.

“We know it means people are not happy and they don’t have high hopes,” Sorensen said. “But if we’re talking recession, that sort of depressed sentiment needs to translate into actual economic activity. And so far, it hasn’t. And we’re not actually sure if it will.”

Tariffs are a wild card

The Trump administration’s tariff policies, however, remain a major wild card.

A broad 10% tax on imports that took effect April 5 remains in place with a few exceptions. Tariffs of up to 50% on about 60 countries are on a 90-day pause. An active tariff remains on goods from China — initially 125% and more recently raised to 145%.

Overall that’s netted out to a U.S. effective tariff rate — the net tariff on all imports from other countries — between 25% and 30%. That’s 10 times the effective tariff rate of 2.5% a year ago.

“This hasn’t happened in over 100 years,” Sorensen said. “The economy is just structurally very different, and we can try to make forecasts and comparisons —  and we do all day every day —  but we don’t know. There is just so much unknown what this will do.”

For that reason, economic uncertainty is “sky high,” she continued. “I don’t think anyone really knows what’s going on.”

Businesses “are kind of paralyzed,” Sorensen said. “How can you make a business investment decision if you have no idea what tariffs are going to be tomorrow, next week, next year?”

Some larger employers have already begun announcing plans to reshore work in the U.S. But Sorensen said in response to one audience member’s question that isn’t an option for many smaller employers.

A company that sources products overseas might gain a temporary advantage by returning production to the U.S., she said.

“They can’t risk making the wrong choice,” however, Sorensen said. “What we’re hearing is they don’t trust that that tariff will remain in place. So, they can’t make the investment decisions to bring production back to the U.S. because they might want to undo it again as soon as policy changes.”

In addition, “our supply chains are so intertwined that everything has some input that’s imported,” she said.

Tariffs will also squeeze low- and middle-income households, where spending takes a larger share of their earnings — “households that were already struggling,” Sorensen said.

Migration presents another pressure point. Policies to reduce immigration and deport immigrants will hurt some states and some sectors of the economy more than others, she said.

Yet an additional unknown is how the escalating trade conflicts with the rest of the world will affect services — where the U.S. has a trade surplus.

“President Trump has never mentioned that, because he probably doesn’t want us to know that, right? It makes trade look a little more fair, but that’s not the story he wants,” Sorensen said.

So far, other countries haven’t targeted U.S. services in retaliation for the tariffs it has imposed.

Nevertheless, “if countries really want to get us economically, they would go after services,” Sorensen said.

GET THE MORNING HEADLINES.

SUBSCRIBE

Sen. Rand Paul, R-Ky., speaks during a nomination hearing with the Senate Committee on Homeland Security and Governmental Affairs on Capitol Hill on April 03, 2025, in Washington, D.C.  Paul was the sole GOP co-sponsor on Wednesday, April 30, 2025, of a resolution to terminate President Donald Trump's tariffs. (Photo by Anna Moneymaker/Getty Images)

WASHINGTON — Senate Republicans defended President Donald Trump’s emergency tariffs Wednesday, blocking a largely symbolic measure to terminate the president’s import taxes that have shocked the economy.

The resolution failed in a tied 49-49 vote Wednesday evening. Vice President J.D. Vance broke the tie on a subsequent procedural vote to stop the measure from receiving another chance on the floor.

Republicans Susan Collins of Maine, Lisa Murkowski of Alaska and Rand Paul of Kentucky were the only three to break with their party in support of reining in Trump’s use of emergency powers to trigger tariffs on nearly every other nation across the globe.

Paul was the lone Republican co-sponsor on the Senate resolution, which was likely to go nowhere under House Republican leadership.

Sen. Sheldon Whitehouse, a Rhode Island Democrat, and Kentucky Republican Mitch McConnell missed the vote. Earlier in April McConnell joined Collins and Murkowski in voting to halt Trump’s tariffs on Canada.

‘Devastating’ economic news

The vote came hours after the release of figures showing the U.S. economy shrank during the first quarter of 2025. 

“The devastating economic news we got this morning should be enough for senators to vote yes tonight. The only winner today is China, which is scooping up markets and allies Donald Trump has left in the dust,” Democratic Sen. Ron Wyden of Oregon said on the floor just before the vote.

Wyden and Paul co-sponsored the resolution that aimed to block Trump’s “Liberation Day” tariffs announced April 2 that caused market upheaval.

The president’s shockingly high taxes on goods imported from some of the nation’s closest trading partners — 20% on the European Union, 24% on Japan, 46% on Vietnam — rocked global markets, erasing trillions in wealth. Trump triggered the levies by declaring foreign trade as a national emergency.

Trump announced a 90-day pause on the tariffs starting April 9, but left in place a 10% universal import tax on nearly every country across the globe — excluding China.

The White House is now in an all-out trade war with the world’s no. 2 economy, raising tariffs on Chinese goods to 145%. China stopped at a 125% levy on American goods.

Kaine warning

Democratic Sen. Tim Kaine, who also co-sponsored the resolution, told reporters on a press call Wednesday that he’s willing to “link arms” with Trump to fight what the U.S. views as China’s unfair trade practices, but he said Trump needs to “wake up and smell the coffee” on the damage to relationships with trading partners.

“When you put tariffs on allies what you do is push away the very nations you could be joining with to counter China,” the Virginia Democrat said.

Kaine also blamed Trump’s trade policy for Wednesday’s negative economic headlines.

The Bureau of Economic Analysis report showed the U.S. gross domestic product decreased at an annual rate of 0.3% in the first three months of this year.

“It’s the wrong economic strategy to turn the strongest economy in the world to one that has red flashing lights on it,” Kaine said.

Kaine said he believed some House Republicans would support the resolution but that “leadership has bottled it up.”

Trump blames Biden

Trump’s administration officials and his allies in Congress continue to defend the tariffs. The president himself blames former President Joe Biden for the economic “hangover,” as he described it in his Truth Social post Wednesday.

“This will take a while, has NOTHING TO DO WITH TARIFFS, only that he left us with bad numbers, but when the boom begins, it will be like no other. BE PATIENT!!!,” Trump wrote.

Senate Majority Leader John Thune similarly told reporters on Capitol Hill Wednesday that economic reports are “short term.”

“They measure it sort of day by day, month by month, quarter by quarter. And as I said yesterday, I think that with the tariff issue that they’re playing the long game, but we’ll see,” the South Dakota Republican said.

Treasury Secretary Scott Bessent defended Trump’s import taxes Tuesday from the White House briefing room, but also announced the administration’s reprieve on 25% taxes on foreign cars and auto parts.

Senate Minority Leader Chuck Schumer slammed the vote Wednesday night.

“Leader Thune and Senate Republicans tonight voted to keep the Trump tariff-tax in place. They own the Trump tariffs and higher costs on America’s middle-class families,” the New York Democrat said in a statement.

Demonstrators holds signs as a motorist passes with flags supporting President Donald Trump during an April 5, 2025, protest in Columbia, South Carolina. Protestors organized nationwide demonstrations against Trump administration policies and Elon Musk's U.S. DOGE Service. (Photo by Sean Rayford/Getty Images)

WASHINGTON — Tuesday marked the 100th day of President Donald Trump’s second term, a period filled almost daily with executive orders seeking to expand presidential power, court challenges to block those orders and economic anxiety that undermines his promised prosperity.

Trump has taken decisive actions that have polarized the electorate. He’s used obscure authorities to increase deportations, upended longstanding trade policy with record-high tariffs, made drastic cuts to the federal workforce and ordered the closure of the Education Department.

Those moves have garnered mixed results and led to legal challenges.

The approach to immigration enforcement has yielded lower numbers of unauthorized border crossings compared to last year. But the immigration crackdown has barreled the country toward a constitutional crisis through various clashes with the judiciary branch.

Those nearing retirement have watched their savings shrink as Trump’s blunt application of tariffs, which he promises will replace income taxes, roils markets. Administration officials have promised the short-term tariff pain will benefit the country in the long term.

And White House advisor and top campaign donor Elon Musk’s efforts at government efficiency have resulted in eliminations of wide swaths of government jobs. That includes about half of the Education Department workforce so far, though Trump has signed an executive order to eliminate the department.

The controversial moves appear unpopular, as Americans delivered record low approval ratings for a president so early in his term. Polls spearheaded by Fox News, NPR, Gallup and numerous others yield overall disapproval of Trump’s job performance.

Deportation push tests legal boundaries

Immigration was Trump’s signature issue on the campaign trail and his first 100 days were marked by a crackdown carried out against people with a range of immigration statuses and at least three U.S. citizen children. The aggressive push has led to clashes with the judiciary branch.

A burst of Inauguration Day executive orders Trump signed upon his return to office included some hardline immigration policies he’d promised.

On day one, he declared a national emergency at the U.S.-Mexico border that enabled his deployment two days later of 1,500 troops to help border enforcement.

He sought to end birthright citizenship and ended several forms of legal immigration, including humanitarian parole for people from certain countries, and suspended refugee resettlement services.

District courts blocked the birthright citizenship and refugee resettlement measures and an appeals court has upheld those interpretations. The U.S. Supreme Court will hear arguments in May on birthright citizenship.

Trump’s record on immigration is a clear example of his desire to expand executive power, said Ahilan Arulanantham, a co-director of the Center for Immigration Law and Policy at the University of California Los Angeles School of Law.

“It’s an attempt to expand the government’s powers far beyond anything that we have seen before in this realm,” he said.

Unprecedented authorities

The administration has taken a series of actions considered nearly unprecedented to conduct mass deportations.

On March 8, immigration authorities detained Mahmoud Khalil, a lawful permanent resident who helped organize Palestinian protests at Columbia University.

Authorities never accused Khalil of committing a crime, but sought to revoke his green card under a Cold War-era provision that allows the secretary of State to remove lawful permanent residents if the secretary deems their presence has “potentially serious adverse foreign policy consequences.”

Similar arrests followed at universities across the country.

In mid-March, Trump invoked the Alien Enemies Act of 1798 to deport two planeloads of people his administration said belonged to the Venezuelan gang Tren de Aragua.

It was only the fourth time the law was invoked and the first outside of wartime. The first flights left U.S. soil en route to a mega-prison in El Salvador on Saturday, March 15, amid a hearing on the legality of using the law in peacetime.

When a federal judge entered an oral order to turn the flights around, the administration refused, arguing the oral order was not valid. The administration also ignored a subsequent written order demanding the return of the flights, later arguing the flights were outside U.S. airspace at that time and impossible to order returned.

Administration officials mocked the court order on social media.

The Supreme Court on April 7 allowed for the use of the Alien Enemies Act to deport suspected gang members of Tren de Aragua. However, the justices unanimously agreed that those removed under the wartime law needed to have due process and have a hearing to challenge their removal.

Abrego Garcia

A third March 15 flight carried a man who was mistakenly deported in an episode that has gained a national spotlight.

Maryland resident Kilmar Abrego Garcia, a native of El Salvador, had a final order of removal, but was granted deportation protections by an immigration judge because of the threat he would be harmed by gangs if he were returned to his home country. Despite the protective order, he was deported to the notorious Centro de Confinamiento del Terrorismo, or CECOT prison.

After his family sued over his deportation, the administration admitted he’d been removed through an “administrative error,” but stood by its decision.

The administration argued it had no power to compel the El Salvador government to release Abrego Garcia, despite a possibly illegal $6 million agreement with the country to detain the roughly 300 men.

A Maryland federal court and an appeals court ruled the administration must repatriate Abrego Garcia, whose wife and 5-year-old son are U.S. citizens, and the Supreme Court unanimously ruled that the Trump administration must “facilitate” his return, but stopped short of requiring it.

The administration has done little to indicate it is complying with that order, earning a rebuke from a conservative judge on the 4th Circuit Court of Appeals.

“The Supreme Court’s decision does not … allow the government to do essentially nothing,” Circuit Court Judge J. Harvie Wilkinson III wrote.  “‘Facilitate’ is an active verb. It requires that steps be taken as the Supreme Court has made perfectly clear.”

The administration’s relationship with the courts — delaying compliance with orders and showing a clear distaste for doing so — has led to the brink of a constitutional crisis, Arulanantham said.

“They’re playing footsy with disregarding court orders,” he said. “On the one hand, they’re not just complying. If they were complying, Abrego Garcia would be here now.”

But the administration has also not flagrantly refused to comply, Arulanantham added. “They’re sort of testing the bounds.”

Tariffs prompted market drop

Trump’s first 100 days spiraled into economic uncertainty as he ramped up tariffs on allies and trading partners. In early April, the president declared foreign trade a national emergency and shocked economies around the world with costly import taxes.

Following a week of market upheaval, Trump paused for 90 days what he had billed as “reciprocal” tariffs and left a universal 10% levy on nearly all countries, except China, which received a bruising 125%.

Some products, including pharmaceuticals, semiconductors, lumber and copper, remain exempt for now, though the administration is eyeing the possibilities of tariffs on those goods.

The administration now contends it will strike trade deals with some 90 foreign governments over the pause, set to expire in July.

Meanwhile, an all-out trade war rages with China after Trump hiked tariffs on the world’s no. 2 economy even further to 145%. China responded with 125% tariffs on U.S. goods. The two economies share a massive trading relationship, both in the top three for each other’s imports and exports.

‘Chaotic’ strategy

Inu Manak, fellow for trade policy at the Council on Foreign Relations, summed up Trump’s first 100 days as “chaotic.”

“We haven’t seen anything like this in our U.S. history in terms of how trade policy is being handled. It’s very ad hoc,” Manak said.

“U.S. businesses can’t figure out what to do. And even for the large companies, it’s hard for them to know some of the long-term trajectories of where this was going to go,” Manak said.

Shortly after his second term began, Trump declared a national emergency over illicit fentanyl entering the U.S. — an unprecedented move to trigger import taxes — and began escalating tariffs on Chinese goods, as well as up to 25% on certain products crossing the borders from Canada and Mexico.

Trump hiked existing tariffs on steel and aluminum in mid-March under trade provisions meant to protect domestic production and national security, followed by 25% levies on foreign cars and auto parts — though Trump signed two executive orders Tuesday to grant some tariff relief to carmakers. 

The import taxes have alarmed investors, small businesses and American consumers following the 2024 presidential campaign when Trump made lowering prices a major tenet of his platform.

The latest University of Michigan survey of consumers — a staple indicator for economists — reported consumer outlook on personal finances and business conditions took a nosedive in April. Expectations dropped 32% since January, the largest three-month percentage decline since the 1990 recession, according to the analysis. 

Manak said Trump’s tariffs are “really at odds with” with the administration’s objectives of helping U.S. manufacturers and cutting costs for Americans.

“The U.S. now has the highest tariff rates in the world,” she said. “That’s going to hurt both consuming industries that import products to make things, and then consumers as well. We’re starting to see notifications coming out on layoffs, and some small businesses considering closing up shop already. And the tariffs haven’t been in place for that long.”

Rhett Buttle, of Small Business for America’s Future, said the policies are “causing real damage in terms of not just planning, but in terms of day-to-day operations.”

Buttle, a senior advisor for the advocacy group that claims 85,000 small business members, said even if Trump begins to strike deals with other countries, entrepreneurs will likely be on edge for months to come.

“It’s that uncertainty that makes business owners not want to hire or not want to grow,” Buttle said. “So it’s like, ‘Okay, we got through this mess, but why would I hire a person if I don’t know if I’m gonna wake up in two weeks and there’s gonna be another announcement?’”

Support dropping

Trillions were erased from the U.S. stock market after “Liberation Day” — the White House’s term for the start of its global tariff policy. The S&P 500 index, which tracks the performance of the 500 largest U.S. companies, is overall down 8.5% since Trump’s inauguration, according to The Wall Street Journal’s analysis.

Numerous recent polls showed flagging support for Trump’s economic policies.

In a poll released Monday, Gallup found 89% of Americans believe tariffs will result in increasing prices. And a majority of Americans are concerned about an economic recession and increasing costs of groceries and other goods, according to an Associated Press-NORC Center for Public Affairs Research survey between April 17 and April 22.

The Pew Research Center similarly found a growing gloomy outlook among U.S. adults from April 7 to April 13. Results showed a majority of Americans — 59% across race, age and income levels — disapproved of Trump’s approach to tariffs. But when broken down by party, the survey showed a majority of Democrats disapprove while the majority of Republicans approve of the tariff policy.

American households are poised to lose up to $2,600 annually if tariffs remain in place and U.S. fiscal policy doesn’t change, according to the Yale Budget Lab. Analyses show low-income households will be disproportionately affected.

“If these tariffs stay in place, some folks are going to benefit, but a lot of people are going to get hurt,” Manak said.

The White House did not respond to a request for comment.

Government spending

Trump began his second term with a flurry of action on government spending, challenging the balance of power between the president and Congress.

Efforts to unilaterally cancel funding already approved by lawmakers, who hold the authority to spend federal dollars under the Constitution, led to confusion and frustration from both Democrats and Republicans, especially after the U.S. DOGE Service froze allocations on programs that have long elicited bipartisan support.

Many of the Trump administration’s efforts to roll back appropriations are subject to injunctions from federal courts, blocking the cuts from moving forward while the lawsuits advance through the judicial system.

Kevin Kosar, senior fellow at the conservative-leaning American Enterprise Institute, said Trump’s actions on spending so far have sought to expand the bounds of presidential authority.

“We’ve never seen a president in modern times who’s been this aggressive in trying to seize control of the power of the purse,” he said. “To just say, ‘I’m not going to fund this agency, like USAID, despite money being appropriated for it. And we’re going to walk over and take their plaque off their wall and lock their doors.’ This is new.”

Many of Trump’s actions so far indicate to Kosar that the administration expects a change to the balance of power following next year’s midterm elections, when the president’s party historically loses control of at least one chamber of Congress.

“It feels to me that the first 100 days are in large part predicated on an assumption that they may only have two years of unified Republican control of the House of Representatives, the Senate and the presidency,” he said. “We know the margins in the House are quite narrow, and the heavy use of executive actions and the simple defunding of various government contracts and agencies all through executive action, just tell me that the administration feels like they have to get everything done as fast as they possibly can, because the time is short.”

Kosar said he’s watching to see if Trump works with Republicans in Congress, while they still have unified control, to codify his executive orders into law — something he didn’t do with many of the unilateral actions he took during his first term.

“He just did executive actions, which, of course, (President Joe) Biden just undid,” he said. “And I’m just wondering: Are we going to see this movie all over again? Or is he going to actually partner with Congress on these various policy matters and pass statutes so that they stick?”

Zachary Peskowitz, associate professor of political science at Emory University, said Trump has been much more “assertive” during the last 100 days than during the first few months of 2017.

DOGE ‘winding down’

U.S. DOGE Service and Musk hit the ground running, though their actions have fallen short of the goals he set, and appear to be sunsetting with the billionaire turning his attention back toward his businesses.

“I think the big bang is winding down. They did a lot of things early on. It’s not clear how many of them are going to stick, what the consequences are,” Peskowitz said. “And I think, big picture, in terms of federal spending, the amounts of money that may have been saved or not are pretty small.”

Democrats in Congress released a tracker Tuesday listing which accounts the Trump administration has frozen or canceled to the tune of more than $430 billion.

But Trump has just gotten started.

The administration plans to submit its first budget request to Congress in the coming days, a step that’s typically taken in early February, though it happens a couple months behind schedule during a president’s first year.

That massive tax-and-spending proposal will begin the classic tug-of-war between Congress, which will draft the dozen annual appropriations bills, and Trump, who has shown a willingness to act unilaterally when he doesn’t get his way.

Trump and lawmakers must agree to some sort of government funding bill before the start of the fiscal year on Oct. 1, otherwise a partial government shutdown would begin. And unlike the reconciliation package that Republicans can enact all on their own, funding bills require some Democratic support to move past the Senate’s 60-vote cloture threshold.

Eliminating the Education Department

Researchers and advocates predicted even more changes to the federal role in education, underscoring anti-diversity, equity and inclusion efforts and a continued ideological battle with higher education that have marked Trump’s approach to education policy in his first 100 days.

In a torrent of education-related decisions, Trump and his administration have tried to dismantle the Education Department via an executive order, slashed more than 1,300 employees at the department, threatened to revoke funds for schools that use DEI practices and cracked down on “woke” higher education.

The Trump administration has taken drastic steps to revoke federal funding for a number of elite universities in an attempt to make the institutions align more with them ideologically.

Rachel Perera, a governance studies fellow at the Brown Center on Education Policy at the Brookings Institution, cited “brazen lawlessness” when reflecting on Trump’s approach to higher education in his second term.

“The ways that they’re trying to withhold funding from universities are very clearly in violation of federal law and the processes mandated by civil rights law in terms of ensuring that institutions are offered due process in assessing whether violations have taken place,” Perera said. “There’s not even a pretense of pretending to investigate some of these institutions before taking really dramatic action.”

Whether the administration’s approach continues or not depends on court action, she added.

“I think what the next three years might look like is really going to depend on how some of these lawsuits play out,” Perera said, referencing some of the major legal battles involving the Trump administration. 

Wil Del Pilar, senior vice president at the nonprofit policy and advocacy group EdTrust, said “much of what this administration has done has been overreach.” He pointed to the Education Department’s letter threatening to yank federal funds for schools that use race-conscious practices across aspects of student life as one example.

Del Pilar, who was previously deputy secretary of postsecondary and higher education for the state of Pennsylvania, said the administration is “going to take any opportunity to grab at power that advances their ideology.”

Meanwhile, Perera said the consequences of the department implementing a reduction in force plan in March “have yet to be felt.”

“I think we will start to see really the material consequences of the reduced staffing capacity in the coming years, in terms of how programs are administered, in terms of how funding is moving out the building, in terms of auditing, making sure funding is going to the right groups of students that Congress intended for the money to go to, whether big data collection efforts that are congressionally mandated are being carried out in timely and effective ways,” she said.

“All of that remains to be seen.”

Ariana Figueroa contributed to this report. 

Automakers across the industry are scrambling to navigate Donald Trump’s tariffs, and some are getting particularly creative in their strategies. Rivian, for example, has apparently taken a refreshingly proactive stance. Sources with knowledge of the situation say the automaker is sitting on a stockpile of batteries that it’s been buying up since before the election even happened.

According to a Bloomberg report, Rivian made a savvy move by locking down a stash of lithium iron phosphate (LFP) cells from China’s Gotion High-Tech Co. well before the election, with the goal of powering its Amazon-bound delivery vans. After the political dust settled, the company then teamed up with Samsung SDI to import a sizable batch of battery cells from South Korea, hoping this would keep production rolling for its R1T pickup and R1S SUV models.

Read: Trump Eases Auto Tariffs With 85% Rule While Buyers Brace For Sticker Shock

The strategic move serves as a buffer against potential pricing pressures induced by Trump’s new tariffs. While recent revisions to the tariff plan offer some relief, they still pose significant challenges for automakers relying on international supply chains. That can heavily impact companies like Rivian who need to import batteries to make every vehicle in their lineup. Notably, Samsung SDI said a week ago that the tariff war would make it more expensive to build EVs.

For now, Rivian has bought itself a little more breathing room before it has to worry about raising prices. In the meantime, it’s also gearing up for the launch of its smaller R2 SUV. With this new vehicle, the company plans to switch to 4695-format cells from LG Energy Solution. The initial production will take place in Korea, but Rivian has plans to move operations to LG’s new Arizona facility in Queen Creek. Even without the tariff issues, that move helps Rivian better align with the Inflation Reduction Act’s requirements.

Whether this is a stroke of logistics genius or just plain survival instinct depends on how you read the political winds. Either way, Rivian’s battery strategy gives it a short-term cushion while it scrambles to localize its supply chain before the tariffs squeeze even tighter. Of all the different strategies we’ve seen automakers employ, this is the first time one has proactively bought up supplies to this degree. 

In the end, Rivian’s proactive approach might just be the thing that keeps it on track, at least until the tariff storm blows over.

Party hats were compulsory headgear at VW’s Zwickau plant in eastern Germany this week. The factory produces six different EVs for various VW Group brands and just built its millionth electric car, an ID.3 GTX hot hatch. But Zwickau’s busy production lines are causing a headache for the bean counters at VW’s Wolfsburg HQ.

The problem is that EVs are expensive to build and deliver smaller margins than equivalent combustion-powered cars. And while electric sales doubling in Europe in the first quarter of 2025 is something to celebrate, some of those sales come at the expense of ICE sales.

Related: VW ID.2 Might Have A Shot In America, But ID.1 Is ‘Highly Unlikely’

As EVs take up a greater proportion of the sales mix – they accounted for one in five VW Group cars in Jan-March – they push profitability down, reducing the margin to 4 percent. And the withdrawal of EV subsidies in many European countries means VW can’t lean on government incentives to allow them to charge more.

But there is light at the end of the tunnel in the form of the VW ID.2 and its various spinoffs and related EVs. The €25k ($28k) ID.2, which will be built in Spain, goes on sale in 2026 and should be one of the first Western-built EVs to return margins close to an ICE car’s. The baby VW and its sister SUV, plus the Cupra Raval and Skoda Epiq use a new front-wheel drive version of the MEB platform that costs less to produce.

Earlier this month VW revealed that earnings before tax were down 40 percent to €3.1 billion ($3.5 bn) in Q1 even as deliveries increased by 1.4 percent. The company’s finance chief Arno Antlitz partly attributes this to EVs taking a bigger slice of the sales pie.

But President Trump’s tariffs threaten to throw an even bigger spanner in the VW Group’s plans. The constantly-changing US import tariff situation is making it harder for automaker to make financial forecasts for the rest of the year, but VW, which is badly exposed due to Audi and Porsche’s lack of US production sites, has already downgraded primed investors to expect a less successful year than previously anticipated.

New Nissan cars are driven onto a rail car to be transported from an automobile processing terminal located at the Port of Los Angeles on April 3, 2024. (Photo by Mario Tama/Getty Images)

WASHINGTON — Treasury Secretary Scott Bessent signaled a reprieve on auto tariffs will come Tuesday ahead of the president’s stop in Michigan to mark his first 100 days in office.

Bessent and White House press secretary Karoline Leavitt confirmed President Donald Trump is expected to sign an executive order Tuesday curtailing the import taxes for domestic car manufacturers, but offered few specifics. The president’s 25% levy on cars and auto parts went into effect at the beginning of April.

“I’m not going to go into the details of the auto tariff relief, but I can tell you that it will go substantially toward reshoring American auto manufacturing,” Bessent said. “And again, the goal here is to bring back the high-quality industrial jobs to the U.S.”

The press secretary and Bessent began the day defending Trump’s trade policy as part of a weeklong morning press conference series marking the 100-day milestone in Trump’s second administration.

Investors and businesses have been on edge since Trump declared foreign trade a national emergency on April 2 and imposed what he billed as “reciprocal” tariffs on nearly every nation. Trump issued a 90-day pause on the steep levies — some reaching nearly 50% — after trillions of dollars disappeared from U.S. and world markets in reaction to the dramatic policy.

However, Trump dug in his heels on goods from China, increasing tariffs to 145%. Nearly all other countries face universal 10% baseline levy.

No deals yet

Nearly a month after the tariffs went into effect, Bessent told reporters the administration has not yet inked deals with any of the 17 trading partners, not counting China, currently in negotiations with the U.S. When pressed about a timeline for the deals, Bessent said Trump has created “strategic uncertainty” as a tool to get the best terms.

“I think the aperture of uncertainty will be narrowing, and as we start moving toward announcing deals, then there will be certainty. But certainty is not necessarily a good thing in negotiating,” Bessent said.

Bessent sidestepped questions about trade talks with China, saying he wouldn’t get “into the nitty-gritty of who’s talking to whom.” China has imposed 125% tariffs on U.S. goods and has denied any meaningful negotiations.

“I think that, you know, over time, we will see that the Chinese tariffs are unsustainable for China,” Bessent said, adding that China sends more goods to the U.S. than Americans send to China.

Americans’ approval of Trump’s job performance, particularly on economic policy, is lagging, according to numerous recent surveys.

In response to a report that Amazon will highlight spikes in prices due to tariffs, Leavitt said the e-commerce behemoth was committing a “hostile and political act.” Punchbowl News reported the story Tuesday citing “a person familiar with the plan.”

Amazon denied the report hours later, according to NPR and other outlets.

Tax cuts

When asked about potential economic damage from business owners clamping down on hiring and growth, Bessent told reporters “tax cuts are coming.”

The secretary said he and Trump met at the White House Monday with congressional Republicans, including House Speaker Mike Johnson of Louisiana and Senate Majority Leader John Thune of South Dakota.

Johnson and Thune have signaled different timelines — from Memorial Day to further into summer — for when Congress would finish a large budget reconciliation package, at the heart of which is Trump’s plan to extend his 2017 tax law.

Bessent said Trump wants the tax bill to revive and expand full business expensing, meaning businesses could write off expenses for certain investments, like equipment.

“The other thing that we are looking to add is full expensing for factories,” Bessent said. “So bring your factory back, you can fully expense the equipment and the building.”

Foreign-made semiconductors are facing scrutiny and tariffs by the Trump administration, which would cause a ripple effect for manufacturing and price of most electronic goods, experts say. (Photo by Narumon Bowonkitwanchai/Getty Images)

The price of technology goods and services in the U.S. will likely rise in the next few months, experts say, as the White House continues to shift its strategy on tariffs for imported electronic hardware.

After initial reports that Chinese goods would receive as high as a 145% tariff, President Donald Trump said on April 13 that electronics like smartphones, computers and semiconductors — chips that process, power and transmit information — would be exempt. But Trump said later that day that imported semiconductors, and the electronics they’re embedded in, will likely be facing their own tariff structure in the coming weeks.

In tandem with Trump’s announcement, the U.S. Department of Commerce announced an official investigation into semiconductor imports, aiming to study the national security implications of importing manufacturing equipment and derivative products. The move is likely two-fold, tech experts say — Trump’s aim with foreign tariffs is to pressure American manufacturers to make more goods in U.S. facilities.

But his administration is also likely looking for cybersecurity risks that could be introduced through foreign manufacturing, like in compromised operating systems, embedded malicious code, or flawed designs, said Derek Lemke, senior vice president of product level intelligence at risk management firm Exiger.

“They power everything from advanced weapons systems and critical infrastructure to smartphones and laptops,” Lemke said. “Many of these components are manufactured abroad, often in regions with rising geopolitical tensions or limited transparency into supply chain practices.”

The U.S. is currently upping its manufacturing of semiconductors. It produced about 10% of the world’s semiconductors in 2022, and is projected to reach 14% by 2032 with the additional funding and infrastructure provided by the CHIPS and Science Act, passed during the Biden administration. But while many advanced chips are designed by American companies like Nvidia, Apple, Qualcomm and AMD, they are manufactured in Taiwan, which is currently negotiating tariff deals with the U.S.

Many electronics involve manufacturing processes from all over the world, making the tariff structure involved a complicated one. And while it’s a good idea for Americans to manufacture more of their semiconductors to diversify the global supply chain of chips, the country is nowhere near prepared to make as many as we need, said Nikolas Guggenberger, an assistant professor of law with a focus on antitrust, law and technology, privacy, and regulation at The University of Houston Law Center.

Guggenberger called semiconductor manufacturing “among the most complex industrial processes on Earth,” which would require years of planning, training and billions in investment for the U.S. to become a leader.

While the U.S. awaits more clarity over tariffs on electronic goods and the findings of the semiconductor probe, Guggenberger and Lemke say that American consumers should prepare themselves for higher prices on smartphones, laptops and other personal devices. Because semiconductors are used in so many everyday products, those price hikes could seep into wider spending, Guggenberger said.

“From a computer to everyday devices, like a garage opener, or a toaster,” he said. “It’s everything, it’s absolutely everything.”

Guggenberger said there’s a possibility that very high tariffs could also lead to a pause or slowdown in manufacturing in general, meaning consumers may see emptier shelves or a backlog on products in a few months.

Those on the software side of the tech industry will feel the effects, too, Lemke said. Software companies, AI developers and cybersecurity experts all rely on computing power from chip hardware, and disruption in the supply chain could slow innovation in these businesses, he said.

Even just the discussion of tariffs is having a ripple effect through the tech sector, Lemke said. Companies are having to evaluate their supply chains, their sourcing and maybe stockpile some components to their products.

“The uncertainty alone is enough to influence pricing, procurement strategies and investment decisions across the tech ecosystem,” Lemke said. 

After reporting its first-ever decline in annual deliveries last year, Tesla is bracing for another disappointing year. Analysts attribute the waning demand to a wide range of issues, including damage to the brand caused by CEO Elon Musk’s newfound role within the U.S. Government. Overseas, growing competition, particularly within China (Tesla’s second-largest market), is also cited as a concern, as is the company’s ageing lineup.

More: Tesla Plans Smaller Model Y That’s 20% Cheaper To Produce

Fans and investors have been hoping for some relief, with the lower-priced Tesla Model Y “Juniper” variants expected to boost sales. More importantly, H1many were anticipating the launch of Tesla’s most affordable EV yet. Inside sources suggest that this model will be a smaller, stripped-down version of the current Model Y, codenamed E41,that will be at least 20% cheaper to produce.

Delay and New Timeline

Tesla had initially stated that it would release and begin production of the cheaper new model in the first half of 2025, with a separate Reuters report later suggesting mass production would accelerate in early 2026. However, it’s now being reported that the launch has been delayed.

According to inside sources cited by Reuters, the “cheaper Model Y” has been delayed by several months, though the reasons remain unclear. The same three sources also informed the outlet that the initial rollout will focus on U.S. customers, with a production goal of 250,000 cars to be manufactured in the United States using existing Model Y production lines.

The Chinese launch of the E41 is noew expected to commence later in 2026, with plans for European production also being considered, although a precise timeline has not been announced. The new car is expected to be around 20 percent cheaper to manufacture than the best-selling Model Y.

Bare-Bones Model 3 Incoming

Additionally, plans are underway to introduce a stripped-down Model 3 to the market as well. While details are still unclear, this more basic version will likely be based on the rear-wheel-drive model.

To further reduce costs, Tesla will almost certainly need to cut features, such as replacing leatherette ventilated seats with cloth versions (something already done in Mexico) along with using fewer speakers and other cost-cutting measures, similar to the new base version of the Cybertruck. If Tesla really goes all-in, it might even reduce the battery size, though that would impact range.

The $25,000 “Model 2” Scrapped

However, neither of these new cars will be the $25,000 “Model 2” EV that Elon Musk had promised as far back as 2018. Plans for a low-cost, entry-level EV from Tesla were scrapped in favor of the autonomous RoboTaxi, with Musk stating on an earnings call last year that having a regular $25,000 model would be pointless.

More: A $25,000 Tesla Model 2 Could Hit The Sweet Spot For EV Buyers

The cheaper E41 will still have to overcome the 25 percent tariffs imposed on auto parts. To counteract the levies, Tesla has reportedly increased North American sourcing of parts, which will decrease the E41’s exposure to the ongoing supply chain volatility.

Note: The lead image is a digitally altered version of the current Model Y

Car buyers looking for a break may be in for a short-lived reprieve. While vehicle prices are widely expected to rise in response to the Trump administration’s new tariff policy, March offered a rare moment of calm. Both new and used car prices dipped slightly compared to February, and on average, they were less than 1% higher than they were in March 2024.

It’s a temporary win for shoppers, but don’t expect it to last. Once dealers run through their pre-tariff inventory, the market is likely to shift.

Read: Crushing Import Tariffs Could Kill Audi’s Best-Selling Model In America

Data from Cox Automotive reveals that the average monthly transaction price for new cars in the US last month was $47,462. This is a small decline from the $47,577 of February. Curiously, the ATP discrepancy between ICE models and EVs has actually increased recently, even though EVs should, in theory, be approaching price parity.

EV Prices Push Higher

Estimates put the average ATP of a new EV in March at $59,205. This is a 7% increase year-over-year and up from $57,015 in February. This is in part due to rising Tesla prices, with its ATPs estimated at $54,582, or 3.5% higher year-over-year, and jumping 4.5% from February, too.

Average transaction prices at other brands have also jumped. For example, Land Rover ATPs hit $107,129 in March, up 8.8% from February’s figure of $98,478. They are also up 6.1% year-over-year. Lincoln and Mitsubishi ATPs also rose 4.7% and 4.3% month-over-month, hitting $68,281 and $31,692, respectively.

Not All Prices Are Rising

A few automakers actually posted lower ATPs in March. For example, they were down 5% at Cadillac in March, dropping to $74,078. They also declined 5.8% at Jaguar to $64,403, and were down 2.6% at Dodge and Infiniti, falling to $49,548 and $62,276, respectively.

Cox Automotive’s data also reveals that total market sales climbed significantly in March, even though prices and incentives largely remained steady. It estimates that 1.59 million new vehicles were sold last month in the US. If accurate, this would represent the best sales volume month in nearly four years and is a 30% increase from February.

Read: Average EV Transaction Price $6,300 Higher Than Gas Cars

The reason is simple. Many car shoppers have been rushing to buy a new vehicle before the tariffs hit and increase prices across the market.

“All signs point to higher prices this summer, as existing ‘pre-tariff’ inventory is sold down to be eventually replaced with ‘tariffed’ inventory,” Cox executive analyst Erin Keating said. “How high prices rise for consumers is still very much to be determined, as each automaker will handle the price puzzle differently. Should the White House posture hold, our team is expecting new vehicles directly impacted by the 25% tariff to see price increases in the range of 10-15%.”

Months after the EU imposed hefty tariffs on Chinese-made EVs, officials from China and the European Union are reportedly working on a deal that would allow them to avoid relying on those tariffs. Instead of sticking with tariffs, the two sides are now exploring the idea of setting minimum prices for China’s EVs as a potential solution.

Read: BMW Teams Up With Chinese EV Makers To Fight EU Tariffs In Court

A spokesperson from the European Commission confirmed that EU trade commissioner Maros Sefcovic and Chinese commerce minister Wang Wentao recently had a chat and agreed to explore the minimum price idea. At this stage, more discussions are in the works, though no specifics have been shared just yet.

What’s on the Table?

As of now, there’s no clarity on what these minimum prices might look like. Sefcovic spoke with Reuters, emphasizing that any pricing rules would need to be just as effective and enforceable as tariffs, without creating additional complications.

The European Union imposed tariffs on Chinese-made EVs last year following a lengthy investigation to see if Chinese brands received unfair subsidies from their government, allowing them to build and sell EVs for far less than most Western rivals. Newly-enforced tariff rates vary depending on how much assistance individual brands received and how cooperative they were with the EU’s probe.

For example, Chinese conglomerate SAIC received the harshest penalty: a 35.3% tariff on top of the pre-existing 10% import duty. Other companies, like BYD and Geely, were hit with tariffs of 17% and 18.8%, respectively.

The decision to impose tariffs was far from unanimous. Ten EU countries voted in favor, but 12 abstained, and five voted against. Notably, Germany opposed the tariffs, and the country is now pleased that talks are underway to find a more balanced solution.

“Regardless of current global developments, it must also be discussed here how to reduce obstacles and distortions in international trade, rather than building new hurdles,” Germany’s auto industry association, the VDA, said in a statement.

As the negotiations continue, it remains to be seen whether this minimum pricing strategy will gain traction or if it will be another attempt to sidestep deeper issues in global trade.

While several industry insiders told School Transportation News last week that it was too early to tell the impact of new Trump administration tariffs on imports, Blue Bird representatives told investors to expect a 5-percent price increase on all non-electric school buses.

The company made the statement last week during its fiscal year 2025 first quarter financial results call, which reported the company’s second-best quarterly profit and margin, the eighth consecutive quarter of beating guidance, and $250 million of electric school buses in “firm order backlog.”

“Our position is that any potential government tariffs will be passed through to the end customer so there will be no net financial impact on Blue Bird,” said Phil Horlock, who is retiring as president and CEO this week but retaining his board of director seat.

John Wyskiel succeeds Horlock on Feb. 17.

Last week, President Donald Trump paused for 30 days a 25-percent tariff on imported goods from both Canada and Mexico, though a 10-percent tariff on Chinese imports went into effect. Essentially, think of tariffs as an added sales tax by the federal government, Blue Bird CFO Razvan Radulescu said during the Q&A portion of the call on Feb. 5.

Meanwhile, Horlock said Blue Bird is confident U.S. Environmental Protection Agency Clean School Bus Program funding will continue unfettered. He shared details from a Feb. 4 memo issued by Gregg Treml, the acting CFO of EPA, that stated a federal court injunction pausing Trump administration freezes on unspent federal program funding under the Infrastructure Investment and Jobs Act “shall not be paused and disbursement of funds shall continue while ongoing litigation proceeds or until otherwise directed by a Court.”

Horlock said Blue Bird also has confirmed political support for the Clean School Bus Program with members of Congress.

He added the court order reversing the freeze should also protect nearly $80 million in Domestic Manufacturing Conversion Grant Program funding from the U.S. Department of Energy that was appropriated under the Inflation Recovery Act. The funds are to be used to convert Blue Bird’s diesel motorhome manufacturing plant in Fort Valley, Georgia, into a 600,000 square-foot Type D electric school bus facility.

To address the initial pause in EPA funding, Horlock said Blue Bird reprioritized production to build fully-funded school buses earlier and pushed back build dates for bus orders to be paid for with federal money. He added the manufacturer is also prioritizing “significant new EV orders” paid for by state and local funding. Still, Blue Bird lowered the number of forecasted electric school bus deliveries to 1,000 units from the previous range of 1,000 to 1,300.

The company also noted higher internal combustion engine school bus prices compared to a year ago and at comparable levels with its competitors.

Blue Bird also said the quarter-one results beat the previous guidance and that it remained on track to meet the full-year guidance of Adjusted EBITDA at $200 million and a 14-percent margin.

---

Related: U.S. Delays Tariffs with Canada, Mexico as Bus Associations Warn of Fallout
Related: (STN Podcast E215) Next-Level Safety: Exclusive Interview – Seatbelts Standard on Blue Bird Buses
Related: Blue Bird Announces Standard Lap/Shoulder Seatbelts on All School Buses

The post Blue Bird: Tariffs Would Increase Non-EV School Bus Prices by 5% appeared first on School Transportation News.

President Donald Trump reached an agreement with Canada and Mexico to delay 25-percent import tariffs with each country that were set to go into effect Tuesday.

Trump signed the  executive order Saturday, and Canada responded with its own threat of a 25-percent tariff on $30 billion worth of U.S. goods, also set for Tuesday. The Ministries of Finance and Foreign Affairs said Canada also intended to impose a tariff on $125 billion in additional U.S. goods, which includes electric vehicles, trucks and buses.

The U.S. agreements with Canada and Mexico to postpone the tariffs by at least 30-day days hinged on more investment at both the northern and southern border to curb immigration and the flow of drugs, especially fentanyl.

A 10-percent tariff with China moved forward and went into effect Tuesday.

The American Bus Association (ABA), United Motorcoach Association (UMA), Motor Coach Canada (MCC), and Ontario Motor Coach Association (OMCA) said they are closely monitoring the trade disputes between the U.S. and Canada and warned of the impact to manufacturers, suppliers and consumers.

​ABA, UMA, MCC and OMCA issued a joint update Sunday that said the tariffs could significantly impact the motorcoach industry, which like the school bus industry relies on a global supply chain involving components from both countries. The associations added they are coordinating advocacy and lobbying efforts to mitigate the impact of the tariffs and are encouraging members to share their concerns.

Last month, S&P Global said the blanket tariffs would have a “massive impact” on nearly all automative manufacturers worldwide, with reciprocated tariffs by Canada and Mexico adding “another degree of complexity.” While commenting specifically on passenger vehicles, S&P Global noted that Canadian or Mexican-sourced propulsion systems and components in U.S. manufactured vehicles “would see a tariff as well.”

It added that the tariffs could add $6,250 to the cost of $25,000 vehicle.

School Transportation News reached out to multiple sources Monday to ask about the potential impact of tariffs  school bus production and sales. One source responded that it was premature to discuss the tariffs as they were being negotiated in real time. Another indicated that the tariffs are subject to continuing negotiations and could change, as “school bus manufacturing isn an American success story,” though concern remains especially about individual components.

Meanwhile, Micro Bird, the joint Type A venture between Blue Bird of Fort Valley, Georgia, and Girardin Minibus of Drummondville, Quebec, is the only school bus currently manufactured in Canada for sale in the U.S.

Electric school bus manufacturer GreenPower Motor Company has headquarters in Vancouver, British Columbia, but the company manufactures out of Porterville, California, and South Charleston, West Virginia. RIDE, the school bus arm of Chinese company BYD, manufactures its electric school buses in Lancaster, California.

An auction process begins this month for Lion Electric Company, which obtained bankruptcy protection in December.

Additionally, many school bus suppliers of technology solutions and equipment are based in Canada or have manufacturing there. Many school bus components are also imported from China.

​This is a developing story.

---

Related: NAFTA Replacement is Expected to Ease Tariff Concerns
Related: Updated: Lion Electric Suspends Manufacturing Operations at Joliet Plant
Related: Electric School Bus Manufacturing Included in Nearly $2B Federal Energy Grant

The post U.S. Delays Tariffs with Canada, Mexico as Bus Associations Warn of Fallout appeared first on School Transportation News.