Tariffs, tension, and treading water

Tariffs take center stage

• President Trump rolled out a 10% baseline tariff on all imports starting April 5 calling it ‘Liberation Day’. Reciprocal tariffs up to 49% will follow on countries hitting U.S. goods with duties. What it could mean: This puts a cost floor under almost everything coming into the U.S., including downstream aluminum goods. U.S. buyers may pivot harder toward domestic converters and roll formers to avoid import headaches, which only adds to the domestic demand squeeze already building around aluminum.
• New 25% tariffs on imported vehicles go live April 3, with auto parts facing the same starting May 3. Vehicles from Mexico and Canada are exempt under USMCA. What it could mean: For aluminum companies, especially those tied to the Big Three or Tier 1 suppliers, this means more pressure to source locally. Demand may shift to U.S. or Mexico-made extrusions, sheet, and cast parts.
• China responded to “Liberation Day” tariffs with a 34% tariff on all US imports, matching the US levy on imports from China. Why it could matter: China remerged as a home for US exports of aluminum scrap again in the first quarter of 2025, with volumes on track to nearly double 2024 levels on an annualized basis – already a jump from the year before. This could have a chilling effect on scrap exports – or at the very least make them economically unattractive – which could keep more material in an already tight US market.
• A 25% tariff also hit imported beer and empty aluminum cans, although there’s some confusion about how that affects recycled can material versus new imports. What it could mean: It could give U.S. can sheet producers a leg up if importers back off. But until Customs clears up HTS code enforcement, companies dealing in scrap or used cans may hesitate.
• Auto sales data for March showed a big import push from Mexico ahead of the tariffs. GM deliveries jumped 17%, Ford gained in March, but overall Q1 was mixed. Models like the Mach-E, Ram, and Equinox all saw surges and each were assembled in Mexico. What it could mean: Dealers were clearly stocking up ahead of the tariffs, therefore the spike may be short-lived.
• Tesla’s Q1 sales dropped by 50,000 vehicles while production outpaced demand. The EV narrative is cooling, at least for now. What it could mean: Less demand for EVs could mean less action on aluminum-heavy platforms, sheet, castings, and extrusions might slow if the EV buildout takes a breather.
• Novelis plans to shut down two U.S. facilities: Fairmont (foil and fin stock) and Richmond (construction sheet) by end of June. What it could mean: A hit to domestic rolled aluminum capacity. For builders and HVAC buyers, that may tighten the supply of specialty sheet and foil, shifting demand elsewhere, in an already tight market.
• Scrap prices eased in March. After a sharp start to the year, UBC and Twitch grades flattened or fell. Auto shred cooled back to pre-2025 levels. What it could mean: Secondary producers might get some margin relief. But if collection slows too much, it could choke off supply for remelt ingot and billet lines later this quarter.
• Wisconsin Aluminum Foundry bought Michigan-based Anderson Global, a tooling manufacturer. What it could mean: Another sign of vertical integration in the Great Lakes. Tighter control over die/tooling inputs can stabilize output for foundries tied to the auto and truck sectors.