Jim Cramer Says Auto Tariffs Are Inevitable As Alibaba's Joe Tsai Says Chinese EVs May Eventually Be Hit By Them: 'More Than Half The Cars Sold Here Are Imports'

After President Donald Trump delayed the tariffs on automobile companies that comply with USMCA rules last week, the tariffs on carmakers were inevitable due to the high magnitude of imports, explained CNBC’s Jim Cramer in an X post.

What Happened: The Trump administration provided a one-month exemption to the automakers following the United States-Mexico-Canada Agreement, negotiated during his first term. These included automotive parts, accessories, and other supplier products along with completed vehicles.

As a one-month relief helped companies to chalk out their business plans, Cramer said that “Tariffs on cars are and have been expected,” as more than half the cars sold in the U.S. are imports and the tariffs on them are very small.

Tariffs on cars are and have been expected. We have been saying this every day for weeks. More than half the cars sold here are imports and the tariffs are so small on them vs. what they do to us that it is about time.
— Jim Cramer (@jimcramer) March 12, 2025

Trump has been talking about his protectionist policies much before assuming office. Cramer hinted that these tariffs were inevitable.

If there was anyone out there who didn't expect tariffs on foreign cars you need to rethink your approach.
— Jim Cramer (@jimcramer) March 12, 2025

Apart from this, while speaking at a CNBC's event Converge Live, in Singapore, the chairperson of Alibaba Group Holding ADR BABA, Joseph Tsai also acknowledged that "Everyone is concerned about tariffs."

He noted that even if Trump's tariff strategy was merely a negotiation tactic, there was still a strong possibility of targeted tariffs on Chinese electric vehicles. Tsai further suggested that this could be an effort to protect the American auto industry from potential competition.

Why It Matters: While foreign carmakers Volkswagen and Stellantis NV STLA were in compliance with USMCA rules and received the one-month extension, BMW did not meet the criteria for exemption.

The ‘Big 3’ Detroit automakers, which included General Motors Co. GM, Ford Motor Co. F and Chrysler, which is now part of Stellantis, were also exempt from importing parts.

However, apart from the tariffs on automobiles and auto parts, on Wednesday, the Trump administration imposed sweeping tariffs on steel and auto imports, which will also affect the carmakers in the U.S. The European Union, impacted by these latest tariffs, responded within hours by imposing counter-duties on U.S. exports.

Glenn Stevens, who is the executive director at MICHauto, an automotive, mobility, and technology association, criticized Trump’s threat on Canada to shut down its auto industry. He said that the tariffs were “hampering and damaging the free trade bloc that currently operates as the USMCA.”

You are going to shut down more than auto manufacturing in Canada. You are seriously hampering and damaging the free trade bloc that currently operates as the USMCA, signed into existence in your first administration. #Trump #trade #tariffs pic.twitter.com/9i3dq9Q3y2
— Glenn Stevens (@glennrstevens) March 11, 2025

Price Action: The SPDR S&P 500 ETF Trust SPY and Invesco QQQ Trust ETF QQQ, which track the S&P 500 index and Nasdaq 100 index, respectively, rose on Wednesday. According to Benzinga Pro data, the SPY rose 0.53% to $558.87, and the QQQ also advanced 1.13% to $476.92.

Meanwhile, on Wednesday, the three automotive industry exposed ETFs;