Supreme Court Invalidates Trump Tariffs Based on Emergency Powers
The Supreme Court on Friday ruled against President Donald Trump’s use of an emergency powers statute to impose open-ended tariffs, marking a major legal setback for the president’s trade policy. In a 6-3 decision, the court rejected Trump’s claim that the 1977 International Emergency Economic Powers Act gave him the authority to impose broad tariffs globally, saying that Congress alone has the power to lay and collect tariffs, reports WardsAuto. “The Framers [of the Constitution] recognized the unique importance of this taxing power — a power which ‘very clear[ly]’ includes the power to impose tariffs,” the ruling says. The opinion, written by Chief Justice John Roberts, found that Congress’ taxing power cannot be handed off through vague language, rejecting the administration’s argument that the words “regulate” and “importation” in IEEPA gave the president broad powers to impose tariffs. “Recognizing the taxing power’s unique importance, and having just fought a revolution motivated in large part by ‘taxation without representation,’ the Framers gave Congress ‘alone . . . access to the pockets of the people,’” the ruling says. Click here for the full story.
Trump Exempts Vehicles, Parts from New 15% Global Duty After Supreme Court Loss
Vehicles and parts already subject to auto tariffs are exempt from a new 15 percent global duty President Donald Trump issued Feb. 21. Just a day prior, Trump announced a 10 percent global tariff hours after the Supreme Court ruled many of his previous import taxes illegal. “I, as President of the United States of America, will be, effective immediately, raising the 10% Worldwide Tariff on Countries, many of which have been ‘ripping’ the U.S. off for decades, without retribution (until I came along!), to the fully allowed, and legally tested, 15% level,” Trump said in a social media post. The initial 10 percent tariffs Trump announced Feb. 20 were scheduled to go into effect on Feb. 24, according to a White House fact sheet. He is scheduled to deliver the State of the Union address to Congress that evening in Washington. Trump’s post on Feb. 21 didn’t go into details on timing on the increased tariffs, reports Automotive News. The new tariff does not apply to imports of steel, aluminum and copper, nor will it apply to goods from Canada and Mexico that comply with North American trade rules, according to the text of a presidential proclamation Trump signed. Click here for the full story.
Larger Tax Refunds Could Fuel Spring Vehicle Demand
The U.S. auto industry faces a critical early-season test as tax refunds begin reaching consumers, potentially injecting fresh demand into a market strained by high prices, elevated borrowing costs and cautious buyers. Larger refunds could provide a short-term lift in both new and used vehicle sales during the first and second quarters. Early IRS data show the average tax refund is up 10.9 percent compared with the same point last year, reports CBT News. As of Feb. 6, the average refund totaled $2,290, up from $2,065 a year earlier. The increase stems in part from recent federal tax changes, including the One Big Beautiful Bill Act signed in July. The legislation eliminated taxes on overtime and tips and allows eligible taxpayers to deduct up to $10,000 in annual interest paid on loans for new, U.S.-assembled vehicles. Many provisions were made retroactive to January 2025, meaning some taxpayers may have over-withheld and will now receive larger refunds. Economists say the unexpected bump in returns could encourage consumers who have been priced out of the market to revisit a vehicle purchase. The first half of the year, particularly March, is historically strong for vehicle sales. Click here for the full story.
New Dealer Census Shows Consolidation Trend: Fewer Franchises, More Standalone Stores
The 2026 Automotive News dealer census results are in, and automakers, dealers and industry leaders will want to check out what the Automotive News Research & Data Center found in the latest iteration of our annual survey. The total number of dealerships barely changed with 18,300 franchise stores as of Jan. 1, just 11 fewer than a year earlier. But there are more locations housing just a single brand: 13,351, up 1.2 percent from a year earlier. There are also 442 fewer franchises competing for customers compared with last year.These changes reflect Buick, Lincoln and Jaguar plans to have smaller networks selling their vehicles — which in Buick’s case led to more standalone GMC dealerships. And results also show Genesis’ push for exclusive stores instead of the joint Hyundai-Genesis dealerships selling its vehicles in the brand’s early years. After checking out the broader landscape, why not see how well your dealerships (or your franchisees’ dealerships, if you’re an automaker) fared at selling vehicles compared with brand peers and competitors? The Automotive News Research & Data Center calculates the average sales per franchise, also known as throughput, for 43 brands, as well as a national average. Click here for the full story.
Bank of America’s Weekly Market Update
On Friday, December core PCE printed at 0.4% MoM and 3.0% YoY, slightly above consensus, but in line with BofA Global Research’s expectations. Price pressures picked up into year-end and are likely to remain elevated this year as solid growth keeps services inflation sticky. 4Q GDP came in well below expectations at 1.4% q/q saar. However, underlying demand remains firm, with real private sales to domestic purchasers running at 2.4% q/q annualized. GDP finished the year up 2.2%. BofA Global Research expects growth to be stronger this year, with more tailwinds than headwinds. The US Supreme Court struck down President Donald Trump’s global tariffs Friday, saying the President exceeded his authority by invoking a federal emergency powers law to impose his “reciprocal” tariffs. The court voted 6-3, with the majority voicing that the International Emergency Economic Powers Act does not give the President the power to impose tariffs of any amount, duration, or scope. Click here for the full report.
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