Trump considers pausing his vehicle tariffs as the world economy endures whiplash

US President Donald Trump has suggested that he might temporarily exempt the vehicle industry from tariffs he previously imposed on the sector, to give carmakers time to adjust their supply chains.

"I'm looking at something to help some of the car companies with it," Trump said on Monday (Tuesday AEST).

The US president said vehicle manufacturers needed time to relocate production from Canada, Mexico and other places, "And they need a little bit of time because they're going to make them here, but they need a little bit of time. So I'm talking about things like that."

READ MORE: China's Xi Jinping says there are no winners in a tariff war

Matt Blunt, president of American Automotive Policy Council, an association representing Ford, General Motors and Stellantis, said the group shared Trump's goals of increased domestic production.

"There is increasing awareness that broad tariffs on parts could undermine our shared goal of building a thriving and growing American auto industry, and that many of these supply chain transitions will take time," Blunt said.

Trump's statement hinted at yet another round of reversals on tariffs as Trump's onslaught of import taxes has panicked financial markets and raised deep concerns from Wall Street economists about a possible recession.

When Trump announced the 25 per cent vehicle tariffs on March 27, he described them as "permanent." His hard lines on trade have become increasingly blurred as he has sought to limit the possible economic and political blowback from his policies.

Last week, after a bond market sell-off pushed up interest rates on US debt, Trump announced that for 90 days his broader tariffs against dozens of countries would instead be set at a baseline 10 per cent to give time for negotiations.

READ MORE: Trump goes with his gut and the world goes along for the ride

At the same time, Trump increased the import taxes on China to 145 per cent, only to temporarily exempt electronics from some of those tariffs by having those goods charged at a 20 per cent rate.

Last week, after a bond market sell-off pushed up interest rates on US debt, Trump announced that for 90 days his broader tariffs against dozens of countries would instead be set at a baseline 10 per cent to give time for negotiations.

At the same time, Trump increased the import taxes on China to 145 per cent, only to temporarily exempt electronics from some of those tariffs by having those goods charged at a 20 per cent rate.

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