01/05/2025

BIZ & FINANCE THURSDAY | MAY 1, 2025

17

Amazon denies plan to display tariff costs for consumers

Trump tempers duties on automakers NEW YORK: President Donald Trump moved on Tuesday to soften tariffs on automakers, sparking cautious optimism in an industry that has been on tenterhooks as it awaits details on the fast-evolving policy. Trump signed an executive order to limit the impact of overlapping tariffs on automakers. He also released a proclamation that gives the industry a two-year grace period to move supply chains back to the United States and reduce “American reliance on imports of foreign automobiles and their parts”. Automakers have been among the hardest-hit sectors by Trump’s multi-pronged assault on free trade. The announcement of relief coincided with a visit by the president to the Detroit area to celebrate his 100th day in office. “We just wanted to help them during this little transition. Short term,”Trump said. The American Automotive Policy Council welcomed the steps, calling tariff duplication a “significant concern”, according to its president, Matt Blunt. The council represents General Motors, Ford and Stellantis. “We will review the details of the executive order closely to assess how effectively it will mitigate the impact of tariffs on American Automakers, our domestic supply chains and ultimately American consumers,” Blunt said. The administration determined that some relief was needed to give companies enough time to move supply chains to this country, a senior Commerce Department official said in a briefing. “You’re going to see a massive resurgence of domestic auto manufacturing,” the official said. Besides a 25% tariff on finished imported cars, the industry has also been affected by Trump’s 25% tariff on steel and aluminum. Automakers are also set to face new tariffs on foreign auto parts expected to take effect on May 3. Trump’s new policy means that a company would not face both a 25% levy for an imported vehicle and 25% on steel or aluminum; the importer would pay the higher of the two levies, but not both, a Commerce official said. The other change is that companies that import parts for vehicles assembled in the US would be able to offset 3.75% of a vehicle’s list price in the first year and 2.5% in the second year. That modification is designed to give companies two years to move supply chains to the US. Automakers told the Trump administration there would be “dramatic increases in production ... as the payoff to America” from a two-year grace period, the Commerce official said. But analysts have cautioned that Trump’s approach will not incentivise multi-billion-dollar investments if the industry does not believe the tariffs will last throughout his administration and beyond. – AFP

behemoth Meta unveiled its first standalone AI assistant app on Tuesday, challenging ChatGPT by giving users a direct path to its generative artificial intelligence models. “A billion people are using Meta AI across our apps now, so we made a new standalone Meta AI app for you to check out,” the company’s CEO and founder Mark Zuckerberg said in a video posted on Instagram. Zuckerberg said the app“is designed to be your personal AI” and could be primarily accessed through voice conversations with the interactions personalised to the individual user. “We’re starting off really basic, with just a little bit of context about your interests. “But over time, you’re going be able to let Meta AI know a whole lot about you and the people you care about WASHINGTON: US President Donald Trump on Tuesday said Amazon founder Jeff Bezos “did the right thing” by stopping a plan to show consumers how much US tariffs add to each price tag. Earlier on Tuesday, Punchbowl News reported that the e-commerce site would show users how much Trump’s tariffs are hiking the price of products, citing a person familiar with the matter. The report created immediate tension with the White House as it marked its 100 days in office, with the administration eager to defend its high tariff policies against criticism they raise prices for US consumers. Multiple US media outlets reported that Trump personally called Bezos about the matter. Trump, seeming to confirm this conversation, described Bezos to reporters as “very nice” and “terrific”, adding that the Amazon executive chairman “solved the problem very quickly ... and he’s a good guy”. Without fully denying the Punchbowl report, Amazon released a statement saying its low-cost Amazon Haul store had “considered the idea of listing import charges on certain products”. “This was never approved and is not going to happen,” the company statement added. The issue flew into the open when White House press secretary Karoline Leavitt early on Tuesday called the reported plan “a hostile and political act by Amazon”. “Why didn’t Amazon do this when the (Joe) Biden administration hiked inflation to the highest level in 40 years?” she added during a briefing in Washington. o White House earlier attacked reported proposal as ‘hostile and political act‘

Leavitt, joined by US Secretary of Treasury Scott Bessent, holding a news article on Bezos that reads Amazon partnered with China propaganda arm during a briefing in the White House. – AFPPIC

on businesses in the United States. Package delivery giant UPS said on Tuesday it plans to cut 20,000 positions worldwide in 2025 following a significant drop in business from Amazon, its largest customer. UPS chief executive Carol Tome said the firm, which had around 490,000 employees at the end of 2024, was reacting to a “changing trade environment”. – AFP

on most countries, along with higher levies on dozens of countries – only to then pause the elevated rates for 90 days to allow for trade talks. The White House has also imposed steep duties on China, and additional sector-specific measures – leading Beijing to impose its own retaliatory tariffs on US goods. The American president’s tariffs are already starting to have an impact

Also criticising the plan, top Trump adviser Stephen Miller told Fox News that Amazon customers “complain all the time they can’t see where products are coming from and where they’re made”. “A lot of American consumers want to buy products from America,” he added. After taking office in January, Trump slapped a 10% baseline tariff

Meta releases standalone AI app, competing with ChatGPT SAN FRANCISCO: Social media

Super Micro fans AI spending worries with cuts to revenue, profit estimates

from across our apps, if you want.” Embracing the company’s social media DNA, the app features a social feed allowing users to see AI-made posts by other users. “We learn from seeing each other do it, so we put this right in the app,“ Meta chief product officer Chris Cox said as he opened the tech titan’s LlamaCon developers gathering devoted to its open-source AI model. “You can share your prompts. You can share your art. It’s super fun.” The new application also replaces Meta View as the companion app for Ray-Ban Meta smart glasses, allowing conversations to flow between glasses, mobile app and desktop interfaces, the company said. Meta also added an experimental mode designed to let the AI app engage in human style conversations with users. – AFP

following the cuts by a key partner. Delayed “customer platform decisions” moved sales into the fourth quarter, Super Micro said, trimming its preliminary revenue expectation for the three months ended March 31 to a range of US$4.5 billion to US$4.6 billion, from US$5 billion to US$6 billion earlier. Some analysts pinned the cut from Super Micro to its litany of internal issues. “Super Micro’s stumble looks more like self-inflicted wounds than a signal of broader trouble,” said Michael Ashley Schulman, chief investment officer of Running Point Capital. “Tariffs may have nudged sentiment, but it’s internal missteps – customer spending delays and missed expectations – that kicked the stock down the stairs.”– Reuters

SAN FRANCISCO: AI server maker Super Micro Computer on Tuesday cut its third-quarter revenue and profit expectations due to delays in customer spending, amplifying worries of a pullback in AI-linked investments and pushing its shares down 16%. The dour projections come after months of accounting issues had prompted a potential delisting, damaging customer and investor confidence in a company that had emerged as one of the biggest winners of the AI trade. Investor jitters around AI spending have also heightened as President Donald Trump’s sweeping tariffs on trading partners have sparked fears of a global slowdown. Nvidia shares fell close to 2% in after-hours trading while rival AMD’s stock slipped about 1%