Trump Threatens Auto Tariffs, Meets Opposition by Carmakers

American carmakers have shown strong opposition to President Donald Trump’s proposed auto tariffs on imported cars as they could very well hurt car sales, the three top producers argue.

The so-called big three – Fiat Chrysler, General Motors and Ford – could, in theory, benefit from such duties, but they are, nonetheless, calling on the President not to impose the auto tariffs because the automakers believe they will raise the price of vehicles made in the U.S.

“I’m not aware of any company, organization or entity that broadly supports the imposition of these tariffs,” said former Missouri Republican Governor Matt Blunt, who represents the three big American automakers as president of the American Automotive Policy Council.

However, President Trump continues to threaten levies, most recently on Wednesday during an appearance at the White House alongside Austrian Chancellor Sebastian Kurz, when he signaled that should talks with the European Union not yield the expected results, he might impose auto tariffs.

“It’s something we think about and we’re negotiating with them. If we don’t make the deal, we’ll do the tariffs,” Trump pointed out.

The President’s comments come only days after the Commerce Department presented him with its findings on whether imported vehicles and parts pose a threat to national security. The report has not yet been made public, but the auto industry is already making evident its opposition to imposing the proposed tariffs.

Trump also signaled Wednesday that he would make the decision regardless of the findings presented in the report, saying that it would only depend on “whether or not we can make a deal with the EU that is fair.”

But since the tariffs would apply to imported auto parts as well, not just vehicles, car makers maintain the levies would increase production costs.

“There is nothing good that comes out of this, even for the domestic industry. There are going to be spillover effects all over the supply chain,” said Charlie Chesbrough, senior economist at Cox Automotive.

The Center for Automotive Research released a report this month saying that in a worst-case scenario, the tariffs could raise the price of an American-made vehicle by an average of $2,750.

The United States agreed to a fragile trade truce with the EU in July, when Trump promised not to impose new tariffs while trade talks with the Union were ongoing. But now, President Trump is threatening tariffs of up to 25 percent, which European companies, including BMW, Mercedes and Volkswagen, as well as governments have warned could hurt the U.S. economy and disrupt the global auto industry, Bloomberg reports.

Negotiations for a trade agreement have not officially started and the two sides are still at odds over the scope any deal would take.

Be the first to comment

Leave a Reply

Your email address will not be published.