‘Stand up’: Turnbull’s Trump advice to PM

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Donald Trump's announcement trimmed $15 billion from the Australian Stock Exchange, with the benchmark S&P/ASX200 index dropping 0.5 per cent at the start of trading in the first hour.

During question time on Monday, the Prime Minister confirmed he had “booked in” a call with the new president, and said ongoing conversations would be handled “diplomatically”.

"Aussie companies have got big investments in the US steel industry, which is creating thousands of jobs in both the US and back here in Australia," he said.

“We'll keep pushing for Australia's national interests with the US government and we reckon that's also good for the US national interest, because tariffs actually hit our export customers, not us.”

“And that's something that's as clear as day, and it's also a fact that the US has been running a trade surplus with Australia since the Truman presidency.”

But former Prime Minister Malcolm Turnbull, who talked Mr. Trump out of imposing tariffs on Australia during his first term, has some advice for Mr. Albanese.

"Don't be taken in by the notion that Washington's got nothing but a soft spot for Australia. Aussies can be forgiven for thinking that, though," Turnbull said on 7.30 last Monday.

“If you want to earn respect, you've got to show some spine.”

The United States government, especially with Donald Trump, acts in the best interests of the nation of the United States.

“So, we've gotta be able to make the case that it's not in their best interest to impose tariffs on us.”

Mr Turnbull said he would consider using the "one-sided" AUKUS submarine agreement as a bargaining chip if he were PM.

“We need to have a thorough look at the money we're handing over to help support their submarine-building industry,” he said.

“We're committing $US3 billion to bolster this struggling submarine industry of theirs, but there's no promise that we'll even get any new subs out of the deal.”

The United States imported approximately $638 million worth of Australian steel in 2024, according to the UN's COMTRADE database, and major ASX-listed companies such as Rio Tinto would be exposed to these duties.

Fair dinkum, the President of the US said he'll make a formal announcement about this new trade war on Monday in American time, and the tariffs will affect "everybody", which is leaving a lot of people wondering if Australia will cop a raw deal.

"Gotta see, any steel comin' into the States'll cop a 25 per cent tariff," he said to a journalist.

He said aluminium would be socked with a 25 per cent tariff.

A tariff is a tax slapped on imported goods, and as a result, Australian steel and aluminium exports to the US will become costlier for customers, which will likely lead to a decline in demand for them.

High tariffs can significantly hinder exports and should significant duties be levied, Australian industry will be severely affected.

Trade Minister Don Farrell stated on Monday that the government had "consistently made the case for free and fair trade" with their American counterparts.

"We've consistently argued for free and fair trade, including access to the US market for Aussie steel and aluminium," he said.

“Our bilateral economic relationship is a two-way street – Aussie steel and aluminium is generating thousands of good paying American jobs, and it’s playing a crucial role for our shared defence needs as well.”

Australia earlier dodged tariffs threatened during the first Trump administration.

In 2017, former President Trump held out the threat of tariffs, but due to efforts by the previous Prime Minister, Malcolm Turnbull, and the former US Ambassador, Joe Hockey, they managed to secure an exemption in 2018 after a lengthy campaign. Trump instead directed his trade dispute towards China.

The US is Australia's third-largest export market for aluminium, behind South Korea and Japan.

Economist Stephen Innes said Asian markets were scrambling for their "trade war helmets" on Monday morning.

“Trump's latest move ain't just another stoush in the trade stakes. It's a step-up in his 'Australia Fair Dinkum' trade doctrine where no country is off limits,” he said.

There's a high-stakes risk of upsetting international trade flows.

Australia had previously avoided paying the tariff a couple of years ago when Trump was in office.

President Trump then slapped tariffs on exports of steel and aluminium from China, while cutting Australia, Canada, Mexico, the EU and the UK loose from US trade restrictions.

“Gazzy's last stint was very focused on the commercial side of it,” Mr Gilbert said.

That was a major thing that really stuck out for him. I think he uses that as one of his key qualities as a good President.

These do come as a bit of a shock, but we do know he's made threats before and they can be taken back.

“Although a deal has been struck, there will still be an effect on American buyers and companies.”

There was a ripple of shock spreading through Australia's political and business elite on the first day of the working week.

Crusader Caravans has made its American debut with an order of 50 Aussie-designed and locally-made vehicles set to travel to Florida.

The firm has also got two more potential retailers keen to buy – deals that could involve orders for up to 300 vans and give the business a significant boost.

That accounts for about 15 per cent of the vans Crusader builds each year.

“That’s fair dinkum? What are the implications for the business? We're stuck with covering the bill, or we've got to factor it into the product prices we pass on to customers, mate.”

“In an environment where the cost of living and things you only just need aren't priorities, it's more about getting on with it rather than doling it out and, you'd obviously, have a problem with that.”

But, according to Mr Paidoussis, it's also about problems with getting the right parts to the factory on time.

“We do the same in Australia and the US, where we’re involved in global supply chains that involve moving parts or products across several borders,” Mr Paidoussis said.

They're talkin' about bringin' in tariffs, which would definitely add complications and some extra costs, mate.

He said the uncertainty may make Crusader reevaluate its move into the US market.

'From our point of view, if the tariff was significant and substantial, we might think about entering the market again,' Mr Paidoussis said.

Nationals Leader David Littleproud said it was up to the Labor Government to approach the Trump Administration to guarantee that Australia isn't caught up in the tariffs.

The bloke said he's not keen on Aussie tariffs as a way of getting back at us, but reckons we need a system where everyone follows the rules.

"We're a trading nation, and I can tell you that tariffs aren't even imposed on us, but imposed on other parts of the world still have inflationary impacts from things we consume," he said.

“G'day, it's essential we encourage and utilise our position in the world to encourage all countries to play by the rules when it comes to trade, cos a trade war won't do anyone any good, and Australia won't be able to cop out of it either.”

While wishing Australia's US ambassador Kevin Rudd "every success", he agreed that previous negative comments Rudd made on social media could impact the talks.

Mr Littleproud said Australia should "tap into" Australia's long-standing alliance with the US, which includes the AUKUS partnership that had been given support by the Trump administration.

"This is a time when the Albanese government will be judged on their capability to handle the new president," he said.

When you make disparaging comments about leaders in other parts of the world, sometimes it can come back to get you, and unfortunately, it might just end up nailing the Australian economy.

The Coalition's trade spokesperson Kevin Hogan said Rudd must be able to secure the same outcome as former US Ambassador Joe Hockey, who won an exemption under then Prime Minister Malcolm Turnbull.

“A critical component was a strong ambassador – we had Ambassador Hockey who helped Australia made a successful case to get excluded from the United States' steel and aluminium tariffs,” she said.

“The US Ambassador is one of Australia's most important diplomatic roles. Albanese personally chose Kevin Rudd for this position. Albanese and Rudd have a big job to do here.”

Emergency Services Minister Jenny McAllister said the Australian government would “continue to advocate for our interests,” pointing towards meetings between senior Australian ministers and higher-ups in the Trump administration.

“She thinks we're always keeping the best interest of Australians in mind and communicating that clearly in these situations,” she said to Sky.

“They've been really committed and have a high level of involvement with our team during these sessions.”

In January, Foreign Minister Penny Wong lined up a meeting with US Secretary of State Marco Rubio, while Deputy Prime Minister Richard Marles had a sit-down with US Defence Secretary Pete Hegseth over the weekend.

Albanese chatted with Trump not long after his re-election to the US presidency in November last year.