In the most significant legal challenge to Mr Trump’s trade policies, the American Institute for International Steel said it had lodged an action in the US Court of International Trade to have the 1962 statute that the president used to impose steel tariffs ruled unconstitutional.

The president last year invoked a provision known as “Section 232” of the law to launch an investigation into whether steel and aluminium imports posed a threat to US national security. Last month he launched a similar probe into imports of cars and parts from worth more than $330bn last year.

The challenge comes as pro-trade Republicans in Congress, backed by the US Chamber of Commerce and other business groups, seek to roll back the law and rein in the president’s ability to impose further tariffs. They have pointed to what they say is the potential economic damage and concerns of companies over escalating trade wars with China and the EU.

Harley-Davidson this week said it would shift some production out of the US to avoid retaliatory EU tariffs in one of the highest profile corporate repudiations of Mr Trump’s trade agenda.

Under Article 1 of the US constitution, Congress has responsibility for regulating the country’s international commerce. But the legislative branch has, over decades, steadily delegated more trade powers, including in the 1962 law Mr Trump invoked.

Steelmakers, who have lobbied successive US administrations for greater trade protection, called the lawsuit baseless.

“We believe this case is without merit and we are confident the court will reject this challenge to the constitutionality of the Section 232 statute,” said Thomas Gibson, president and chief executive of the American Iron and Steel Institute.

Automakers have said Mr Trump’s plans to impose tariffs on auto imports could raise prices of imported vehicles by as much as $6,000 per car and raise prices of locally made vehicles.

John Bozzella, president of Global Automakers, a group that represents foreign carmakers in the US, said the tariff “will have an impact on every single car and light truck sold in America” if it was also imposed against auto parts because of the use of imported materials to make vehicles domestically produced vehicles.

The Alliance of Automobile Manufacturers, which represents domestic and international car companies, has said that buyers of imported cars would face an average $5,800 price rise from a 25 per cent tariff.

“Nationwide, this tariff would hit American consumers with a tax of nearly $45bn, based on 2017 auto sales. Not included in this figure are costs from tariffs on auto components,” the group said.

Mr Trump originally threatened a 25 per cent tariff on car imports but on Friday reduced that to a 20 per cent tariff on EU auto imports, which have been a longstanding target of his ire. Brussels charges a 10 per cent tariff on auto imports while the US has a lower 2.5 per cent import tax on cars. But the US has also charged a 25 per cent tariff on light trucks since the 1960s as a result of a dispute with the EU over its treatment of US poultry.

Mr Bozzella of Global Automakers said a $30,000 imported car would face a $6,000 price rise, while even the costs of a Honda Odyssey minivan produced in the US would increase by $1,500-$2,000 because of its imported content.

“If this investigation leads to tariffs, retaliation against US exports is inevitable,” he said. “Substantial tariffs against major US auto exports have in fact already been announced, placing American auto workers on the front lines of this trade conflict,” he added, in an apparent reference to EU tariffs against Harley-Davidson motorcycles.

Ten of the 14 auto companies producing vehicles in the US today were based overseas, he said.

The Alliance of Automobile Manufacturers, citing figures from the Peterson Institute for International Economics, said a 25 per cent tariff on imported vehicles and components would result in a 1.5 per cent decline in US vehicle production and cause 195,000 American workers to lose jobs over a one- to three-year period.

If other countries retaliate, job losses could climb to 624,000, the group said.

In a note sent out on Wednesday, economists at Oxford Economics said new US auto tariffs would have “a modest direct impact on the economy” of 0.1 per cent of gross domestic product in 2019, the equivalent of 100,000 jobs. But that would double in 2020. It also would have a much bigger indirect impact on the US economy.