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

Biden: The next president should decide on Ginsburg’s replacement

Joe Biden. Photo: Drew Angerer / Getty Images

Joe Biden is calling for the winner of November's presidential election to select Ruth Bader Ginsburg's replacement on the Supreme Court.

What he's saying: "[L]et me be clear: The voters should pick the president and the president should pick the justice for the Senate to consider," Biden said. "This was the position the Republican Senate took in 2016 when there were almost 10 months to go before the election. That's the position the United States Senate must take today, and the election's only 46 days off.

Trump, McConnell to move fast to replace Ginsburg

Photo: Alex Wong/Getty Images

President Trump will move within days to nominate his third Supreme Court justice in just three-plus short years — and shape the court for literally decades to come, top Republican sources tell Axios.

Driving the news: Senate Majority Leader Mitch McConnell and Senate Republicans are ready to move to confirm Trump's nominee before Election Day, just 46 days away, setting up one of the most consequential periods of our lifetimes, the sources say.

Updated 4 hours ago - Politics & Policy

Coronavirus dashboard

Illustration: Sarah Grillo/Axios

  1. Global: Total confirmed cases as of 10 p.m. ET: 30,393,591 — Total deaths: 950,344— Total recoveries: 20,679,272Map.
  2. U.S.: Total confirmed cases as of 10 p.m. ET: 6,722,699 — Total deaths: 198,484 — Total recoveries: 2,556,465 — Total tests: 92,163,649Map.
  3. Politics: In reversal, CDC again recommends coronavirus testing for asymptomatic people.
  4. Health: Massive USPS face mask operation called off The risks of moving too fast on a vaccine.
  5. Business: Unemployment drop-off reverses course 1 million mortgage-holders fall through safety netHow the pandemic has deepened Boeing's 737 MAX crunch.
  6. Education: At least 42% of school employees are vulnerable.