President Donald Trump on Friday delayed by six months a decision on whether the U.S. will impose additional import tariffs on cars from the European Union and Japan, according to The New York Times.
Trump threatened to impose the tariffs to pressure the EU and Japan to grant better access for U.S. products and to bolster his position domestically in manufacturing states. A White House statement announcing the decision called it a “historic action to protect the American automobile industry, its workforce, and American innovation.”
The White House said national security also figures into the President’s strategy.
The statement said U.S. defense and military superiority “depend on the competitiveness of our automobile industry and the research and development that industry generates.”
The decision to postpone the tariffs comes a day ahead of a deadline set in a Commerce Department report submitted to the White House on Feb. 17. The report concluded that imports of automobiles and certain automobile parts threaten to harm national security.
In postponing his decision on Friday, Trump said he agreed with the conclusion and directed the U.S. trade representative to negotiate agreements to address the national security threat, “which is causing harm to the American automobile industry.”
The decision postpones tariffs that would hit German manufacturers especially hard. Cars made in Germany account for a large proportion of EU exports to the United States. EU officials have rejected the notion that the imports could affect U.S. national security.
EU Trade Commissioner Cecilia Malmstrom earlier this week said she reckoned the U.S. would not slap tariffs on car import this week. She said Monday that negotiations in the transatlantic trade dispute were continuing.
There is currently a 2.5-per-cent tariff on cars imported into the U.S. from the EU. Trump has threatened that he could raise this to 25 percent.
European Commission President Jean-Claude Juncker and Trump agreed last year that no new tariffs would be introduced as long as talks were ongoing. The U.S. also currently is preoccupied with trying to resolve a trade dispute with China.