On Monday, the White House confirmed a Wall Street Journal report that it would limit import duties for carmakers and their suppliers to 25% of the value of cars and parts imported into the United States from abroad, freeing manufacturers of other tariffs that currently are stacked on top—such as those for steel and aluminum. 

This latest tweak to Trump’s trade policy is designed to offer companies more time to shift some production from overseas to the United States. This is a time-consuming process that can take well over a year owing to the complexities of uprooting and relocating entire supply chains. 

“This deal will be a major victory for the president’s trade policy by rewarding companies who are already manufacturing domestically, while providing a runway to manufacturers who have expressed their commitment to invest in America and expand their domestic manufacturing,” U.S. Commerce Secretary Howard Lutnick told the newspaper.

The White House did not respond to Fortune’s request for comment by press time.

Low net approval ratings

Just 100 days into Trump’s second term, the administration is facing increasing pressure to ease the burden on consumers and producers alike. His job approval is falling even before the full brunt of the tariffs is felt: Several big-box retailers like Walmart and Target are privately warning the White House shelves could soon be empty once stocks of inventory are depleted.  

The president’s “economic war against the whole world at once,” as hedge fund billionaire Bill Ackman called it, has resulted in the S&P 500 losing 8% since Trump’s inauguration—and even steeper losses prior to his 90-day tariff pause. The U.S. is now expected by many economists to slide into a self-inflicted recession, and Trump’s popular support at this point is the lowest on record of any presidency in 80 years. 

“The polls from the Fake News are, like the News itself, FAKE!” Trump wrote on Tuesday in a post to his Truth Social platform. “We are doing GREAT, better than ever before.” Yet even surveys conducted by Republican-friendly Fox News indicate his net approval rating is in the negative double digits.

The clearest sign that the White House may be ending its brinkmanship is the absence of Peter Navarro from the airwaves. The trade hawk and architect of the Liberation Day tariffs has largely gone missing following his bust-up with Trump mega-donor Elon Musk, who called him “dumber than a sack of bricks.” 

Yet even the Tesla CEO revealed last week during the company’s Q1 call he has little clue where tariffs are headed, despite being Trump’s closest outside advisor.

The Center for Automotive Research in Michigan estimated earlier this month that the president’s 25% automotive tariffs would lead to an increased cost of $108 billion to all U.S. automakers. These costs—which take full effect from May 3 with the addition of levies on imported car parts—will have to be shouldered either by the businesses, buyers, or some combination of the two.

Trump views industrial reshoring as vital to national security

Industry forecaster S&P Global Mobility cut 700,000 cars from its annual U.S. light-vehicle sales estimate two weeks ago as a result of Trump’s tariffs, calling the downward revision “one of the largest single-month changes” it has made alongside crises like the Lehman collapse and the COVID outbreak.

Nonetheless, CEOs lined up to thank the president for lessening their pain, which the White House believes is necessary to incentivize the reshoring of the industrial base and bolster economic self-sufficiency vital to U.S. national security.

“Ford welcomes and appreciates these decisions by President Trump, which will help mitigate the impact of tariffs on automakers, suppliers, and consumers,” CEO Jim Farley told the Wall Street Journal. His counterpart at General Motors, Mary Barra, meanwhile said her team looks forward to further working together with the Trump administration.

But for exclusive exporters like Porsche, too small to afford its own U.S. assembly line, the tariffs mean potentially hundreds of millions of dollars in added headwinds.

One of the reasons why auto tariffs are so damaging is their ripple effect across entire economies: Carmakers are apex consumers that straddle a broad range of industrial sectors.

Thousands of suppliers large and small feed manufacturers with raw materials and intermediate inputs shipped to automobile factories like precision clockwork. This includes everything from injection-molded plastics to galvanized steel to semiconductors and other advanced electronics.