Navarro, in the TV interview, said the Trump administration views "tariffs as tax cuts," referring to the idea that Republicans could heavily rely on the duties to help pay for the multi-trillion-dollar cost of extending Trump's 2017 tax cuts for another 10 years.

North American car companies have operated across borders for three decades. Tariffs would raise prices and cost jobs in the short run, analysts say.

Stock markets in the Asia-Pacific region made modest gains on Tuesday after President Donald Trump said he is thinking of imposing new tariffs on Mexico, Canada and China. Shares were flat to a little higher after Trump pledged in his inaugural address to bring in a "golden age" for America and stopped short of announcing fresh import taxes on his first day in office.

U.S. stock indexes are drifting higher following a mostly encouraging batch of profit reports from big companies

Global markets were volatile while the dollar rebounded on Tuesday in choppy trading as Donald Trump returned to the White House. President Trump did not immediately impose tariffs on Monday as previously promised,