Worldwide automakers and vehicle suppliers are pushing the Trump administration and U.S. Congress to exempt the European Union and other allies from new steel and aluminum tariffs set to work later on this month, industry officials stated on Friday.
The proclamation President Donald Trump signed Thursday permits importers to seek exemptions for particular items and nations to prevent the tariffs, from which Trump has already currently Canada and Mexico.
U.S. automakers, in general, have much at stake as Trump makes decisions on problems such as the pending renegotiation of the North American Free Trade Agreement and an evaluation of fuel economy requirements through 2025.
Trump’s tariffs, like his hardline NAFTA demands, have the prospective to turn the internationally integrated auto industry upside down.
Administration authorities and others have stated the impact of greater steel and aluminum rates on the cost of a vehicle will be modest.
However a formerly unreported February 27 letter sent to Trump by the American Automotive Policy Council, representing General Motors, Ford Motor and Fiat Chrysler Automobiles, cautioned that the metals tariffs” will include significant additional costs to the United States automobile industry each year.”
The industry letter, observed by Reuters, stated extra price boosts “could arise from supply-related constraints, which could result in an equally large increase in price” and ultimately lower vehicle sales, harming steel and aluminum producers.
One big concern, according to some U.S. industry officials, is that Europe will counter Trump’s tariffs with its own tariffs on U.S. products.
Trump could then follow through with a threatened new tariff on European-made automobiles. But eventually, increased expenses could make it unprofitable to develop automobiles in the United States and production will move elsewhere.