Auto groups slam Trump's imports investigation, possible tariffs

Share

The Commerce Department said the investigation will cover cars, SUVs, vans, light trucks and automotive parts.

Hours later, the White House released a statement that Trump had spoken to U.S. Secretary of Commerce Wilbur Ross "to consider initiating a Section 232 investigation into imports of automobiles, including trucks, and automotive parts to determine their effects on America's national security".

The Journal, citing sources in the auto industry, said the plan to retaliate likely would face significant opposition from trading partners and auto dealers that sell imports.

Officials confirmed overnight that an inquiry had been opened into whether imported vehicles and parts "threaten to impair the national security" of the United States.

While many companies said they were still waiting to see the likely effect of the measure, carmakers, auto parts suppliers and vehicle dealers said it threatened to raise their costs, depress auto sales and jobs in the United States, and make American-made products less competitive worldwide. The tariffs on steel and aluminum proved to be quite controversial, forcing delays in the Section 232 report to the president and weakening full implementation of the tariffs.

President Donald Trump is asking for new tariffs of as much as 25% on automobile imports, according to those familiar with his request, after he repeatedly signaled his intention to impose such tariffs.

Trump - whose protectionist platform helped launch him to the White House - has repeatedly floated the notion of steep tariffs that would shield the U.S. auto industry. Treasury Secretary Steven Mnuchin has said that efforts to renegotiate the trade agreement could spill into next year.

The threat of tariffs could also be a useful bargaining chip, as the US tries to negotiate new trade agreements with Japan, Mexico, Canada, and the European Union.

Bozzella noted 12 million cars and trucks were produced in the United States past year. "What they asked for is not fair", said Trump to reporters at the WHite House.

Trump Administration Resumes Pressure Campaign on North Korea
You talk about your nuclear capabilities, but ours are so massive and powerful that I pray to God they will never have to be used. Abe said he had been cooperating closely with Trump, according to a transcript of the press conference provided by his office.

Valliere said Trump's auto threat could backfire and leave the United States isolated.

It was unclear how the Trump administration would be able to use a measure aimed at ensuring national security in the vehicle sector.

Although a large portion of the US's most popular auto models, including those from foreign brands (such as the upcoming BMW X7), are already manufactured within its borders, many are imported from other countries.

"We will continue to be very firm in our defence of Canadian auto workers while underlining that to attack Canada, it will end up hurting the USA too, and no one wants that", the prime minister said. Canada has been very hard to deal with ...

'Crossing the border irregularly isn't a short cut into Canada, and there is a very high likelihood that if they are not actually fleeing the kinds of things that make you a refugee - which is war, persecution, terror, violence. then they are going to be sent back home, ' Trudeau said.

"I'm increasingly getting the impression that the United States does not believe in competition for ideas and customers anymore, but only in the law of the jungle", said Eric Schweitzer, president of the German business group.

On Wednesday morning, Trump indicated some action is coming on autos, although it was unclear whether he was referring to ongoing talks with China, NAFTA negotiations with Canada and Mexico or something else. Past year the USA imported over 8 million vehicles from Canada, Mexico, Japan, South Korea and Germany.

VDA noted that actual trade flows in the auto industry are different to the impression given in policy statements by Trump.

"So that was a very good activity [steel and aluminum tariffs] for us and we are looking forward to researching whether cars should be handled in a similar fashion", Ross said on CNBC's "Squawk Box".

Share