Trump Says 30% Tariff Is Coming To European, Mexican-Made Cars On August 1

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5 days ago

Good morning! It's Monday, July 14, 2025, and this is The Morning Shift, your daily roundup of the top automotive headlines from around the world, in one place. This is where you'll find the most important stories that are shaping the way Americans drive and get around.
In this morning's edition, Trump sets a new date for tariffs against vehicles made in the EU and Mexico, Elon Musk says he doesn't want Tesla and xAI to merge, GM idles its truck plant in Mexico, and Land Rover recalls thousands of Range Rover Evoques for an airbag issue.
Read more: Popular Cars Consumer Reports Recommends You Skip In Favor Of Something Better
1st Gear: New Tariffs Are Coming To The EU, Mexico
If you were tired of hearing about tariffs, then I've got some bad news for you. President Trump just unveiled his latest round of tariff ultimatum, setting a 30% duty on things made in Mexico and the European Union. He sees to be going with the "never let 'em know your next move" method of haphazard negotiation.
The President announced the changes in two letters posted on social media over the weekend. He informed some very important trade partners that the new rates would kick in on August 1 if they could not negotiate better terms. His past few weeks have been split between this confusing (and expensive) shuffling of tariffs and dodging questions about Jeffrey Epstein. These latest levels are tweaked from the tariff levels he proposed in April. From Automotive News:
The EU had been hoping to conclude a tentative deal with the U.S. to stave off higher tariffs, but Trump's letter punctured the recent optimism in Brussels over the prospects for an 11th-hour agreement between the major economies.
Trump did, however, leave an opening for additional adjustments.
"If you wish to open your heretofore closed Trading Market to the United States, and eliminate your Tariff, and Non-Tariff, Policy and Trade Barriers, we will, perhaps, consider an adjustment to this letter," Trump wrote.
The tariff rates would apply widely, though separate from the president's sectoral tariffs on products such as automobiles and steel. If implemented, it could place the EU at a competitive disadvantage on American exports to the neighboring U.K., which left the bloc in 2020 and was the first country to come to a top-line trade pact with Trump.
Germany's VDA auto association tells AutoNews that there is still no solution to easing the current 27.5% duty on cars imported from the EU to the U.S. At the same time, European automakers are still holding out hope (such a silly move) that the two entities can reach some sort of agreement to lower auto import tariffs, potentially including a so-called "netting mechanism" to offset imports with exports. Something like this could be based on the value of exports out of the U.S. market, rather than the number of exported vehicles.
In Mexico, Trump wants President Claudia Sheinbaum to continue supporting the securing of the border between the two North American countries.
Trump added that if Mexico "is successful in challenging the cartels and stopping the flow of Fentanyl," the U.S. would consider adjusting the levies.
"These tariffs may be modified, upward or downward, depending on our relationship with your country," he added.
The letter is silent on whether the U.S. will preserve a carve-out for goods traded under the USMCA trade deal, which have been exempt from the current 25 percent rate. The administration has previously said it will keep the exemption for Canada.
Other countries Trump has pointed to for tariff hikes in recent days include South Korea, South Africa, Indonesia, Thailand, and Cambodia, as well as Algeria, Libya, Iraq, and Sri Lanka.
What is bro doing?
2nd Gear: Musk Doesn't Want Tesla, xAI To Merge
Tesla CEO Elon Musk says he does not support a merger between the automaker and his artificial intelligence start-up, xAI, which owns the Grok chatbot that has been having some major issues with racism, sexism, homophobia, and antisemitism lately.
This news comes after Musk announced that Grok was on its way to being implemented in Tesla vehicles, something I've got no doubt would go totally smoothly. From Reuters:
In response to a user post on X that asked Tesla investors if they supported a merger between the two companies, Musk replied "No."
On Sunday, Musk had said he would ask Tesla shareholders to vote whether Tesla can invest in xAI, after earlier saying "it would be great" if Tesla could do so.
[...]
xAI acquired X, formerly called Twitter and also owned by Musk, in a $33 billion deal in March this year, valuing the combined group at $80 billion at the time.
Sources told Reuters in June that xAI had been in talks to raise money at a valuation of more than $120 billion, while a valuation of as high as $200 billion was also discussed.
The Wall Street Journal reported on Saturday that Musk's SpaceX had committed $2 billion to xAI as part of a $5 billion equity round.
The way Elon's companies invest in each other sort of makes me feel like rearranging deckchairs on the Titanic. It's quite the masterful gambit by Musk.
3rd Gear: GM Idles Mexican Plant
General Motors says it is idling production at a pickup truck plant in Silao, Mexico — where it builds the Chevy Silverado and GMC Sierra — for several weeks. The plant was down for the first two weeks of July, and it's scheduled to be idled again the weeks of August 4 and August 11. From Automotive News:
"Scheduled down weeks at GM Silao are part of a standard operating process focused on optimizing production at our manufacturing complex," GM said in response to a Reuters inquiry.
The Silverado and mechanically similar Sierra are by far GM's top sellers in the U.S., and major profit generators. GM also builds the Silverado and Sierra at factories in Fort Wayne, Ind., Flint, Mich. and Ontario, Canada.
It is common for automakers to halt factory work to perform maintenance or adjust assembly lines for model changes. Most of GM's U.S. factories were not operating last week as part of a usual down week for the July 4 holiday.
Trucks like the Sierra and Silverado — among some of the best-selling vehicles in America — are absolutely crucial for GM. The automaker sold 278,599 Silverados and 166,409 Sierras in the first half of 2025. Those numbers represent a 2% and 12% respective increase in sales over the same period in 2024. Any downtime seems sure to hurt sales efforts.
4th Gear: Thousnds Of Range Rover Evoques Recalled For Airbag Issue
Jaguar Land Rover -- which recently resumed shipping vehicles to the U.S. -- is recalling U.S.-market Range Rover Evoques built between 2021 and 2025 because the front passenger airbag could tear during deployment. Obviously, that's not ideal, and it could lead to a further risk of injury in a crash if the hot gases inside the bag escape. From AutoEvolution:
[T]he airbag module in question is produced by the Hungarian arm of Joyson Safety Systems.
[...]
Jaguar Land Rover started looking into this matter in May 2023, following a number of reports from the manufacturer of the fascia assembly over abnormal front passenger airbag deployments. After many analyses and much investigation, the British automaker concluded in June 2025 that the airbag material showed variability in the folds of suspect airbags.
The Recall Determination Committee ultimately decided on a safety recall on June 30, 2025. Thankfully for both customers and JLR's legal team, Jaguar Land Rover is not aware of any reported injuries resulting from this concern. The recall documentation filed with the National Highway Traffic Safety Administration does not explicitly state how the supplier corrected this condition in airbag production or if the remedy modules come from a different supplier.
Owners and lessees will have the possibly faulty airbag modules replaced at Land Rover dealerships, who will be informed no later than July 21. Owners can expect to be notified by mail on or before August 25. In total, 20,999 Evoques are being recalled, according to Reuters.
Reverse: Built Ford Tough
We really don't talk enough about how wild it is that ol' Gerry Ford was able to become the freaking President without receiving a single vote. The man was just built different. If you want to learn more about our 38th President (and the second who shared a name with a car brand), head over to History.com.
On The Radio: Cobra Starship - Good Girls Go Bad Feat. Leighton Meester
There's no better song in the world for hanging in the corner with your five best friends and jamming out.
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