trade war

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Nissan feels the effect of US-China trade war

Cars, EV adoption, Nissan, trade war / /

Nissan’s future product portfolio is feeling the effects of some of Trump’s other policies. Working with congressional Republicans, the president has chosen to end federal tax incentives meant to encourage the adoption of clean energy vehicles like EVs. As a result, many new EVs will get $7,500 more expensive for most customers from October 1.

There’s no question that EV incentives help spur demand, given the higher purchase price of an EV. No credit means lower demand, so Nissan is delaying a pair of EVs it plans to build in Canton, Mississippi, according to Automotive News. The automaker has told its suppliers to expect a 10-month delay to the original schedule for an electric Nissan crossover now due for November 2028, and an Infiniti version that will now go into production in March 2029.

It’s not the first time this year that the production schedule at the factory in Canton has been torn up and redone. In April, Nissan said it had to “face reality” and accept that “the sedan market is shrinking,” as it cancelled a pair of electric sedans that were also to be built in Canton in the coming years.

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Court blocks Trump’s retaliatory tariffs, amplifying trade war chaos

Donald Trump, Policy, tariffs, trade war / /

Trump quickly appeals

Trump has immediately appealed the ruling and is expected to take the case to the Supreme Court. He’s arguing that the court cannot define what constitutes a “national emergency,” which is a political question he believes only Congress can address.

White House spokesperson Kush Desai has made it clear that Trump remains “committed to using every lever of executive power to address” the “crisis” of trade deficits, CNN reported, which he claimed have “decimated American communities, left our workers behind, and weakened our defense industrial base.”

But the three-judge panel has already indicated that Trump may be focusing on the wrong question in seeking to further his case, noting that the “question here is not whether something should be done; it is who has the authority to do it.” According to the court, Trump does not.

Americans celebrate Trump loss

Ultimately, the judges agreed with US plaintiffs who alleged that tariffs risked vast harms to Americans, including spiking prices on their goods. Earlier this month, the Consumer Technology Association forecasted that Americans could pay more than $123 billion more annually for just 10 common gadgets hit with tariffs.

Oregon Attorney General Dan Rayfield, among other state enforcers who are suing, issued a statement criticizing Trump’s previously “unchecked authority” that he said threatened to “upend the economy” and celebrating the win for “working families, small businesses, and everyday Americans.”

“President Trump’s sweeping tariffs were unlawful, reckless, and economically devastating,” Rayfield said. “They triggered retaliatory measures, inflated prices on essential goods, and placed an unfair burden on American families, small businesses and manufacturers.”

Problems with sourcing and pricing were decreasing orders even to American businesses, suing US firms said, and for many, the sudden spike in costs at the border caused “a large, immediate, strain” on cash flow. At least one plaintiff alleged they could go out of business and be unable to pay employees without an injunction soon. One cycling store feared tariffs might cost it about $250,000 by the end of 2025.

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US and China pause tariffs for 90 days as Trump claims “historic trade win”

Policy, trade war / /

The deal announced today “did not address what would happen to low-value ‘de minimis’ ecommerce packages shipped from China to the US,” Reuters wrote. The US imposed 120 percent tariffs on those packages.

Treasury Secretary Scott Bessent said today that both governments want to avoid a severing of their economies but that the US still plans to impose tariffs on specific items that the White House wants to be produced in the US. Bessent said that “neither side wants a generalized decoupling. The US is going to do a strategic decoupling in terms of the items that we discovered during COVID were of national security interests, whether it’s semiconductors, medicine, steel, so we still have generalized tariffs on some of those, but both sides agree we do not want a generalized decoupling.”

The S&P 500 index was up about 2.6 percent today as of this writing, while the tech-focused NASDAQ Composite index had risen about 3.5 percent. Neither index has recovered to its record high after months of turmoil caused by Trump’s tariffs.

Reuters quoted Zhiwei Zhang, chief economist at Pinpoint Asset Management in Hong Kong, as saying that the 90-day deal was better than he expected. “I thought tariffs would be cut to somewhere around 50 percent,” Zhang said. “Obviously, this is very positive news for economies in both countries and for the global economy and makes investors much less concerned about the damage to global supply chains in the short term.”

In April, Trump raised tariffs on China while pausing tariff hikes on other countries for 90 days. Trump struck a trade deal with the UK last week, and talks with other countries are continuing.

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