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Home / Business / Auto industry cries foul as trump moves towards car tariffs

Auto industry cries foul as trump moves towards car tariffs



WASHINGTON (AP) – Having started a trade with China and Enraged U.S. Pat. Allies with steel tariffs, President Donald Trump is primed for his next fight. He is targeting a product at the heart of the American experience: cars.

Trump's latest plan is to consider slipping tariffs on imported cars and auto parts.

The action has also begun to provoke a backlash among members of Congress, who have so far been reluctant to challenge.

On Thursday, manufacturers, suppliers, car dealers and foreign diplomats want to test their car tolls.

In May, Secretary of Commerce Wilbur Ross had said, "After the hearing, the Commerce Department wants to decide whether or not to import vehicles and parts of it."

Yet even General Motors, which ostensibly would benefit from a tax on its foreign competition, is opposed to Trump's plan.

And even considering the administration's trade was with China over Beijing's predatory practices in high-tech industries and even after America's closest allies, Trump's auto tariffs raise the ante substantially: The US last year imported $ 1

92 billion in vehicles and $ 143 billion in auto parts – figures that the $ 29 billion in steel and $ 23 billion in aluminum imports and the $ 34 billion in Chinese goods the administration has so far hit with tariffs.

"This is "It's a gigantic notch," said Mary Lovely, a Syracuse University economist who studies trade. Trump's proposed 25 percent auto tariffs.

In the Senate, Democrat Doug Jones of Alabama and Republican Lamar Alexander of Tennessee have announced plans to introduce legislation. Both warned that the tariffs are at risk of thousands of jobs in their states.

"Foreign automobiles and auto parts are not a threat to our national security," Jones said. "But you know what is a threat? A 25 percent tax on the imported goods. "

Nor is America's auto industry crying for help against foreign competition. US car sales reached 17.2 million last year – the fourth-best haul on record. Since the end of the Great Recession in 2009, U.S. 343,000 jobs.

Despite Trump's threat, the auto trade was might not happen anytime soon, if at all

"I'm hoping it's just bluster," said Paul Ritchie, owner of Honda and Kia dealerships in Maryland and Pennsylvania. "I understand where the administration is coming from. Our trade imbalances should be corrected. I'm not sure you can take 25-30 years of neglect on trade imbalances and try to fix it in six months. "

Even if the car tariffs are not just negotiating, it could take time before they kick in: It took 10 months for the steel and aluminum tariffs.

In targeting steel, aluminum and perhaps autos, the administration has armored an obscure provision of trade policy: The Trade Expansion Act of 1962 empowers a president to impose unlimited tariffs on particular imports.

The administration has broadly suggested that White House trade adviser.

Automakers, in the meantime, have warned that tariffs would raise their costs – and their customers'. In GM's filed comments, GM warned that "increased import tariffs could lead to a smaller GM, a reduced presence at home and abroad for this iconic American company, and risk less -not more – US. Jobs. "

" There are no automakers that has 100 percent of US-sourced parts, "which are based on the US-sourced parts. said Brian Krinock, Toyota's senior vice president for North American factories. "It is a global business with global operations."

Toyota manufactures nine models in the United States, all of which use some imported parts. About 30 percent of the Camry's parts are imported, Krinock said, and a 25 percent tariff on those parts would increase the cost of a Camry by $ 1,800.

The Toyota Sienna, made in Princeton, Indiana, would be nearly $ 3,000 more expensive , said, and the Tundra pickup truck, made in San Antonio, Texas, would cost $ 2,800 more.

Car collectors, too, have expressed their opposition to the tariffs.

"I have been a lifelong car enthusiast, and old cars posing no threat to national security. Neither do their parts, "wrote Mark Gillett of Dallas," urging commerce to exempt cars and parts of a certain age. "

Adam Posen, president of the Peterson Institute for International Economics, estimated that the tariffs would increase by 9 percent to as high as 21 percent for luxury models. They would cut the industry's output 1.5 percent and cost 195,000 jobs, a Peterson analysis found.

Then there's the threat of retaliation from trading partners. Toyota exports eight U.S.-made models to 31 countries; These exports could be hit by retaliatory tariffs, Krinock said.

Nearly 98 percent of the cars and trucks would have been imported from the United States. Allies: The European Union, Canada, Japan, Mexico and South Korea. If all these countries are retaliated by their 25 percent duties on U.S.. car exports, it would deepen the impact on the U.S. Economy and cost up to 1.2 million jobs in the United States, Posen estimated.

The Commerce Department originally said that it would take one day to pay.

"This is where they are the outcome," he said.

196 196 196 196 196 196 196 196 196 196 196 196 196 196 196 196 196 196 196 196 196 196 196 Detroit. AP Writer Kevin Freking contributed from Washington.

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Follow Paul Wiseman on Twitter at https://twitter.com/PaulWisemanAP and Tom Krisher at https://twitter.com/tkrisher


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