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U.S. and China agree to 90-day pause on most tariffs
CDG News Alert (1 min. read)
Anna del Villar
May 12, 2025
Driving the news: According to the White House, the U.S. and China on Monday agreed to temporarily suspend most tariffs on each other's goods, slashing rates from 125% to just 10% in a major breakthrough that eases trade tensions between the world's largest economies.
For context: The 90-day tariff pause, beginning Wednesday, comes after high-stakes weekend talks in Switzerland. U.S. Treasury Secretary Scott Bessent called the discussions "very productive," though Section 301 tariffs, Section 232 tariffs, and duties on Chinese imports related to fentanyl will remain.
Between the lines: Legacy automakers are growing increasingly concerned about the reach of China's automotive industry, according to a new Kerrigan Advisors survey.
The survey, conducted just before President Trump's April tariffs, reveals 76% of legacy automakers now expect Chinese brands to enter the U.S. market.
And 70% of executives are worried about Chinese manufacturers' growing global market share.
Why it matters: China’s EV market is nothing short of dominant with an abundance of cheap cars propped up by government subsidies. Meanwhile, 80% of automaker executives admit electric vehicle adoption is happening slower than expected, forcing them to maintain parallel investments in both traditional and electric vehicles.
The bottom line: While this tariff pause offers temporary relief, it doesn't solve automakers’ fundamental dilemma–they remain caught between slow domestic EV adoption and the looming threat of Chinese competitors.
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