Automakers, manufacturers oppose president's call for auto tariffs


The Alliance of Automobile Manufacturers, the industry's chief lobbying group in Washington, said this week that a 25% import tariff would increase the average price of an imported vehicle by $5,800, "a tax of almost $45 billion" on USA consumers.

General Motors, the country's biggest automaker with about 110,000 US employees, warned the Trump administration's tariffs threaten to undermine its competitiveness and could lead to "a smaller GM". "We want to explain how tariffs on auto imports may jeopardize them both."The company said broad USA trade barriers on vehicles and auto parts would raise the company's costs and hurt its competitiveness against foreign auto makers, especially against manufacturers in lower-wage countries".

"If import tariffs on automobiles are not tailored to specifically advance the objectives of the economic and national security goals of the United States, increased import tariffs could lead to a smaller GM, a reduced presence at home and abroad" for GM and, "risk less - not more -", the Detroit automaker said.

According to industry sources, the Trump administration is hoping to complete an investigation into the national security implications of auto imports ahead of midterm congressional elections to be held in November.

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Though it did not file comments with the Commerce Department, Ford Motor Co., said lower tariffs are better for jobs and the economy. The administration is said to be considering vehicle tariffs of as much as 25%.

"The correlation between a decline in vehicle sales in the United States and the negative impact on our workforce here, which, in turn threatens jobs in the supply base and surrounding communities, can not be ignored".

GM has 47 manufacturing sites and 25 service-part facilities in the US, where it employs around 110,000 people.

President Donald Trump has repeatedly pressed both US and foreign auto makers to build more vehicles in the USA, which would create jobs in rust-belt states that helped elect him. It buys tens of billions of dollars worth of parts from USA suppliers every year, and has invested over US$22 billion (RM88.7 billion) in United States manufacturing operations since 2009.

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Because the tariffs would inject "uncertainty" into the US economy, the "total shock" could be twice as large, the Oxford analysts wrote. A similar process led to new tariffs on foreign steel and aluminium this spring.

GM operates 47 USA manufacturing facilities and employs about 110,000 people in the country. "A 25 percent tariff on automotive imports, which is just a tax on consumers, would increase the cost of every vehicle sold in the country". "Harley is an American bike" and "they should build them in this country", he said.

Trump threatened last week to impose a 20 percent tariff on auto imports in an attempt to leverage European Union leaders to seek trade talks with the U.S.

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