NAFTA successor ‘big win’ for industry, says auto safety official

NAFTA

The acting top U.S. auto safety official stated on Monday he was sure the U.S. Congress will endorse the trade treaty meant to replace NAFTA, increasing the auto industry and allowing automakers to build safer vehicles at lower prices.

“We think this is such a good deal and we’re very confident it’s going to move forward,” stated James Owens, the acting head of the National Highway Traffic Safety Administration (NHTSA), to Reuters after meeting with auto industry executives to talk about the U.S. Mexico Canada Agreement (USMCA). “We think it’s going to be a win for the industry and a win for workers.”

The USMCA was signed by the three nations about a year ago in an attempt to replace the $1 trillion North American Free Trade Agreement (NAFTA) but still requires to be ratified by the U.S. Congress.

U.S. President Donald Trump pushed for a new trade treaty as a way to generate more American manufacturing jobs. Among other things, the USMCA mandates that more of a vehicle must be made utilizing higher-paid American and Canadian employees in order to remain free of tariffs.

U.S. House Speaker Nancy Pelosi stated previous week a breakthrough in talks with the Trump administration on the trade pact with Mexico and Canada could be approaching and that she wanted to pass the deal by the end of 2019.

Owens stated that the new treaty should lead to $34 billion in extra investment in the U.S. auto industry, $23 billion yearly in extra spending in U.S. parts and generate 76,000 U.S. jobs.

The acting head of NHTSA stated the Trump administration’s three-pronged approach – overhauling the U.S. tax system, slashing back regulations and new trade deals like USMCA – will help automakers spend more money in the safety technologies customers want and sell cars to Americans at more affordable costs.

Earlier month, NHTSA stated it was reviving a long-stalled attempt to overhaul the five-star crash rating program for all new automobiles that would encourage automakers to spend in safer accident avoidance technologies.

Owens stated the Trump administration believes its policies will result in bringing the more affordable, safer cars on roads.

The U.S. International Trade Commission issued an analysis in April that estimated the USMCA would modestly increase the U.S. economy but lead to higher vehicle costs and reduce new auto sales.

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