Which Sectors Will Be Hit Hardest by Trump’s Tariffs on Mexico, Canada and China? | Global News Avenue

President Donald Trump took on Tuesday the threat of import taxes on three of the U.S.’s three largest trading partners, a move that said could compete for supply chains and raise prices for U.S. consumers.

Now the U.S. is charging 25% tariffs on imports from Canada and Mexico and raising tariffs on Chinese goods from 10% to 20%. Canada and China quickly announced retaliation measures, while Mexican President Claudia Sheinbaum said Mexico would respond on Sunday.

Tariffs and anti-elections are expected to narrow down total domestic products in the United States, Canada and Mexico and lead to job losses in all three countries. However, the impact will be imbalanced, and Canada and Mexico will hit harder than the United States

But American businesses, especially in sectors that rely on North American supply chains and cheap Chinese goods, will feel pain.

Automobile Manufacturer

Tariffs are expected to significantly increase the cost of automaker Ford (f), general-purpose motor (General) and stellantis (pressure).

All three manufacturing parts are made and assembled in factories in North America. The North American automotive industry is so intertwined that the National Highway Traffic Safety Administration doesn’t even distinguish between parts made in Canada when calculating how much each car is domestic.

Canada and Mexico account for 47% of U.S. auto parts imports, accounting for 54% of auto parts imports in 2023. They are also the main market for U.S. automobile exports, with the two receiving 75% of U.S. auto parts exported that year.

Bloomberg intelligence analyst Michael Dean estimated on Tuesday that Stellantis alone could be hit by 3.44 billion euros in revenue this year. Shares of Jeep and Chrysler manufacturers fell more than 4% on Tuesday. GM shares also lost 4%, while Ford shares fell about 3%.

Home Builder

Tariffs could worsen the housing shortage and affordability crisis in the United States.

Canadian timber, Chinese steel and Mexican and Canadian concrete are just some imported materials that enter U.S. homes and commercial properties. Corelogic estimates that tariffs will increase the cost of building homes by 4% to 6% over the next 12 months. This is a complement to the standard price increase, which means the overall growth could be as high as 10%.

Currently, the average home price is about $422,000. This has been far more affordable than Americans can be, and there is little room for homebuilders to pass on inflation caused by tariffs to buyers.

Construction costs account for more than 64% of home construction costs in 2024, the highest share since the National Association of Home Builders began tracking costs in 1998. Last year, the average homebuilder’s profit margin was about 11%. Increased construction costs and minimum pricing flexibility are expected to shrink these profit margins.

Dr. Holden’s shares (DHI) and Lennar (Lun), two of the largest home builders in the U.S., rose slightly on Tuesday, but each has lost about 10% since the beginning of 2025.

Consumer Electronics

Last year, the United States imported more than half a trillion dollars in computer and economic products, about four times its exports. Electronic imports, including $111 billion worth of cell phones and $116 billion worth of computers, were the biggest contributors to the US $1.2 trillion trade deficit last year, according to the Census Bureau.

NBC’s analysis of Census Bureau data showed that more than $200 billion worth of imported electronic products last year came from Mexico and China.

Best Buy shares (BBYThe e-retailer’s CEO told analysts that about 75% of the products came from China and Mexico, plummeted Tuesday. “We expect our entire classification of suppliers will go to retailers through a certain level of tariff charges, which makes it very likely that the prices for American consumers will increase,” he said.

Oil

The energy sector may see its costs increase due to Trump’s tariffs.

Canada is the largest foreign oil supplier in the United States, accounting for 60% of all oil imports last year. Although Canadian oil was phased out on Tuesday (which will be taxed at a rate of 10% instead of 25%), high import costs could be imposed on oil and gas prices.

The United States is the world’s largest oil producer and a net exporter of crude oil. Nevertheless, if U.S. refineries were to stop buying Canadian oil altogether, the 1.5 billion barrels of crude oil shipped by the U.S. abroad last year would almost offset the shortage.

But American oil companies can’t simply stop buying Canadian oil. Refineries across the country, especially in the Midwest, can handle heavy oil in Canada. It will take years for the refinery to upgrade its infrastructure to accommodate Tuesday’s tariffs.

Retailers

From China and Mexico, there are so many consumer products completed in the United States (from household appliances to toys), and large retailers like Walmart (WMT), Target(TGT) and Costco (cost) may pay some of the prices of Trump’s tariffs.

JPMorgan estimates more than 80% of toys sold in the United States From China. Retailers will also feel the constraints of high consumer electronic prices. Even Walmart’s growing grocery stores may see higher costs given that Mexico receives 40% of U.S. imported fruit and nearly 50% of imported vegetables in 2023.