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Photo: Win McNamee/Getty Images

Already having laid off the highest number of employees in nearly a decade and attempting to recover from a year in which declining global car sales likely reduced world GDP by 0.2%, the auto industry is facing a direct hit from President Trump's threatened tariffs on all goods from Mexico.

Why it matters: Mexico recently became the No. 1 trading partner with the U.S., and a significant percentage of that trade is completed by auto companies. Much of the "trade" is American auto companies exchanging parts, goods and services within entities they own, Deutsche Bank Securities chief economist Torsten Slok pointed out in a note to clients Thursday night.

  • "Trade with Mexico is basically all about the supply chain, which essentially is all about cars."

Driving the news: Trump said the U.S. would add 5% tariffs on all Mexican imports "until such time as illegal migrants coming through Mexico, and into our Country, STOP," in a tweet Thursday night.

  • The White House followed up saying that if the "crisis" at the border isn't resolved, tariffs on Mexican goods will rise by 5 percentage points each month, as high as 25% on Oct. 1.

"The auto industry was already facing trouble," as ratings agency Fitch's chief economist Brian Coulton and analyst Pawel Borowski wrote in a report released Tuesday.

  • "The risk of increased tariffs on global auto trade remains real and would be a significant drag on global GDP if it were to materialize."
  • "The global nature of auto production makes the sector particularly vulnerable to an increase in tariffs."

The big picture: In addition to hurting consumers and company bottom lines, the tariffs are likely to impact jobs.

  • The auto industry is in the midst of a "significant shift," outplacement firm Challenger, Gray & Christmas reported earlier this month, as automakers face changing consumer demands and the implementation of automation.
  • The industry announced 19,802 job cuts through April. That is 207% higher than announced through the same period last year.
  • The total announced cuts for the first four months of this year is the highest since 2009, when 101,036 cuts were announced in the auto sector through April.

American companies have fared particularly poorly, exemplified by Ford’s May 20 announcement that it would cut 10% of its salaried workforce. Six months earlier, General Motors announced the closure of five plants and 14,000 job cuts. Tesla announced over 3,000 job cuts in January.

Go deeper: The world can't afford a trade war right now

Go deeper

21 mins ago - Sports

Robot umpires inch closer to calling MLB games

The Automated Ball-Strike system (ABS), the tech powering what's colloquially known as robo-umps, is inching ever closer to the big leagues.

Driving the news: The independent Atlantic League — which has partnered with MLB since 2019 — last week announced it was doing away with robo-umps after testing them for the past season-and-a-half.

FBI conducts "court-authorized" search of Rep. Henry Cuellar's home

Rep. Henry Cuellar. Photo: Kevin Dietsch/Getty Images

The FBI said it conducted a "court-authorized" search on Wednesday in the area of the Texas home of Rep. Henry Cuellar (D-Texas).

State of play: "The FBI was present in the vicinity of Windridge Drive and Estate Drive in Laredo conducting court-authorized law enforcement activity," an FBI spokesperson told Axios, adding that they "cannot provide further comment on an ongoing investigation."

Big Tech lobbies hard against looming antitrust bill

Illustration: Sarah Grillo/Axios

Big Tech CEOs, including Apple's Tim Cook and Google's Sundar Pichai, have been jawboning lawmakers as a Senate committee takes up a key antitrust bill Thursday.

Why it matters: The bill prompting this lobbying frenzy could upend how tech's giants do business, and tech's critics see this as a "now or never" moment for Congress to check the industry's power.