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Trump threatens to slap taxes on cars coming from Mexico

"We're going to put tariffs on cars," Trump said Thursday afternoon. "It's the big ball game."
Tiguan Production At The New Volkswagen AG Manufacturing Facility In Mexico
An employee installs the rear passenger door on a test frame for a Volkswagen AG Tiguan compact sport utility vehicle (SUV) inside the company's production plant in Puebla, Mexico, on Oct. 13, 2016.Susana Gonzalez / Bloomberg via Getty Images

President Donald Trump on Thursday threatened to impose tariffs on vehicles coming into the United States from Mexico if authorities there did not halt the flow of drugs and migrants across the border.

"We're going to put tariffs on cars," Trump told reporters in the Cabinet Room of the White House on Thursday afternoon. "It's the big ball game."

Shares in automakers Ford, GM, and Fiat Chrysler all took a dip on the news, before resettling.

"This is a more important deal to me than the USMCA," Trump said, referencing the tri-party trade deal that would replace the 25-year-old North American Free Trade Agreement. The new treaty has yet to be ratified by Mexico, the U.S., and Canada.

Acknowledging that the auto industry represented "massive numbers," Trump said Thursday, "The cars are very big. We’re going to tax the cars. And if that doesn’t work, we’re going to close the border."

Last week, Trump threatened to close the U.S. border with Mexico in order to order to stem the influx of migrants from Central America. A complete shutdown would disrupt billions of dollars in annual trade, including $137 billion of food imports and $59.4 billion worth of auto parts.

Levying tariffs has become a frequent negotiating tactic for Trump, who has slapped additional taxes on a series of items including solar panels, washing machines, steel, aluminum, and a variety of crops as part of a campaign promise to prioritize American-made goods.

“You know I will do it. I don’t play games," the president said.