Ford Motor said on Friday it has halted shipments of its SUVs, pick-up trucks and sports cars to China, as it starts to face the heat from retaliatory tariffs that have seen vehicles face taxes as high as 150%.

President Trump said he is in contact with the “highest levels” of the Chinese government about a potential deal to reduce tariffs, appearing to confirm that he is talking to Chinese President Xi Jinping himself.

China is facing a double whammy: corrosive deflation and tariffs that threaten to block trade. Chinese workers will be the biggest casualties.