Skip to main content
Sister Publication Links
  • Automotive News
  • Automotive News Europe
  • Automotive News Mexico
  • Automotive News China
Subscribe
  • Subscribe
  • Newsletters
  • login
  • HOME
  • NEWS BY BRAND
    • Aston Martin
    • BMW
    • Daimler
    • Fiat Chrysler
    • Ford
    • General Motors
    • Honda
    • Hyundai
    • Mazda
    • Mitsubishi
    • Nissan
    • Subaru
    • Tata
    • Tesla
    • Toyota
    • Volkswagen
    • Volvo
    • Mini
    • Rolls Royce
    • Mercedes Benz
    • Smart
    • Alfa Romeo
    • Chrysler
    • Dodge
    • Ferrari
    • Fiat
    • Jeep
    • Lancia
    • Maserati
    • Ram
    • Lincoln
    • Buick
    • Cadillac
    • Chevrolet
    • GMC
    • Acura
    • Kia
    • Infiniti
    • Jaguar
    • Land Rover
    • Lexus
    • Audi
    • Bentley
    • Bugatti
    • Lamborghini
    • Porsche
  • News
    • Auto Shows
    • Photo Galleries
    • Automakers
    • Suppliers
    • Retail
    • Government Relations
    • Trade and Tariffs
    • Technology
    • Labour
    • Lawsuit challenges Trump's authority on steel, auto tariffs
      Automaker-supplier relationships take a hit
      Ghosn's ace for growth: Suppliers
      In-demand tech puts wary suppliers on guard, study finds
    • U.S. metal tariffs sting Magna, but USMCA brings promise of additional work
      U.S. tariffs on steel, aluminum could be gone in weeks, ambassador says
      Magna posts record Q4 revenue, but profits and margins decline
      Ontario aims to replace GM with Magna, Martinrea or other in Oshawa
    • Kia dealer Benny Leung a true Canadian-immigrant success story
      AutoCanada sues former CEO Patrick Priestner for $250M over dealership acquisitions
      Rolls-Royce names BMW exec its new sales VP for Americas
      How GM's Oshawa closure could affect sales, dealerships
    • Level 3 autonomous vehicles now allowed on Ontario roads
      Ford adds 149,652 vehicles in Canada to Takata airbag recall
      Honda wants recall notices to be part of registration renewals
      All wet: Rain could delay the arrival of self-driving future
    • U.S. metal tariffs sting Magna, but USMCA brings promise of additional work
      U.S. tariffs on steel, aluminum could be gone in weeks, ambassador says
      A look at which automakers in Canada meet USMCA's 75% content rule
      Canada seeks Pelosi's support in push to lift U.S. metal tariffs
    • Vehicle screens go super-sized at CES as tech catches up
      All in a day's work
      Ford commits US$4 billion to autonomous vehicles, forms new subsidiary
      Massive data breach at Canadian company hits several automakers, report says
    • GM Canada says it will find 2,400 jobs for Oshawa workers
      FCA to idle Ontario minivan plant for 8 days, union says
      Unifor calls for boycott of GM vehicles if automaker closes Oshawa plant
      Unifor's Jerry Dias, Magna's Don Walker named Automotive News All Stars
    • Toronto Auto Show
  • Opinion
    • Blogs
    • Chevy's 2019 Blazer: More Camaro, less Equinox
      Trump's troubling definition of victory
      The 2019 Nautilus: Lincoln's Cadillac Super Cruise fighter?
      What Cadillac dealers can expect from Steve Carlisle
  • EVENTS, WEBINARS & AWARDS
    • 2018 Auto News Canada All Stars
    • Best Dealership To Work For
    • Canada Congress
    • Webinars
    • More women in dealerships is just plain good for business
    • VIDEO: Why Ford's Hinrichs is bullish on USMCA
      Ontario aims to replace GM with Magna, Martinrea or other in Oshawa
      Dealers told standalone stores 'difficult to remain profitable'
      Ford's Joe Hinrichs: Plant closures have 'cascading effects' on industry
  • +MORE
    • NEWSLETTERS
    • SUBSCRIBE
    • CLASSIFIEDS
    • CONTACT US
    • DIGITAL EDITION
MENU
Breadcrumb
  1. Home
  2. Canada
July 19, 2018 01:00 AM

Auto industry to tell U.S. Commerce Dept. to ditch tariff proposal

Eric Kulisch
  • Tweet
  • Share
  • Share
  • Email
  • More
    Print
    NADA's Welch: Everyone gets hurt.

    WASHINGTON -- A wide spectrum of auto interests, armed with the latest impact studies, will warn at a Commerce Department hearing Thursday that raising auto tariffs would severely harm the industry and consumers.

    The stakeholders are presenting a united front against the Trump administration’s unprecedented investigation into whether imports of autos and auto parts pose a national security threat, saying a potential 25 per cent tariff to limit foreign competition would undermine the very manufacturing growth the president seeks.

    “The National Automobile Dealers Association recognizes the importance to the U.S. of levelling the trade playing field, eliminating unfair trade practices and keeping America’s automotive industry strong,” NADA President Peter Welch said, according to an advance copy of his testimony. “But a 25 per cent tariff applied to all imports would hurt auto manufacturers, dealers, consumers and the economy as a whole. And the hardest hit would be our customers.”

    PRICE INCREASES

    A study by the Center for Automotive Research, commissioned by NADA, forecasts that the price of a typical imported vehicle would rise $6,875, while the price of a U.S.-assembled vehicle would jump $2,270.

    CAR, a think tank supported by the auto industry, estimated that 2 million fewer vehicles would be sold and the industry would lose almost 750,000 jobs, including 117,500 at new-car dealerships. Consumers would also feel the pinch in higher used-car prices due to heightened demand and higher repair costs, CAR said.

    In a soon-to-be published paper, excerpts of which were shared with reporters, the Peterson Institute for International Economics forecasts potential tariffs would raise vehicle prices between $1,400 and $7,000 for top-selling models, depending on a variety of factors including size. The research also predicts auto tariffs could cause 1 million to 1.2 million people to lose their jobs.

    A more conservative Petersen Institute study several weeks ago, showing job losses of more than 600,000 if other countries retaliate, didn’t account for the multiplier effect and the effect on demand caused by higher tariffs.

    FIGHTING BACK

    Auto interests are taking a much more aggressive approach to this trade disagreement with the White House because the stakes are so high for a global industry that sources components and exports vehicles around the world.

    John Bozzella, president of the Association of Global Automakers, accused the Trump administration of pursuing an anti-trade ideology that is not grounded in facts.

    “The Department of Commerce so far has been unable to outline any theory explaining how the commercial production of cars and trucks is connected to U.S. national security. Simply running a sectoral trade imbalance, which the secretary [Wilbur Ross] suggested as a rationale during a recent appearance before Congress, seems insufficient because it does not distinguish the U.S. automobile industry from other industries where this is also the case,” he said, according to a copy of his prepared remarks.

    Bozzella also criticized use of the 1950 Defense Production Act to demand proprietary business information from automakers as part of the investigation.

    “To my mind, this highly intrusive, overbroad and burdensome tactic is simply the latest evidence that the Department possesses no evidence to support the idea that auto and auto parts imports harm the national security of the U.S. The exercise appears to be less an impartial effort to understand the facts than it is a policy hunting for a justification, and a solution in search of a problem,” he said.                       

    There appears to be little public support for the auto tariffs so far. Only a handful of some 2,300 comments received by the Commerce Department favor the idea and half of consumers recently surveyed (773) by Cox Automotive said potential tariff increases will impact their next vehicle purchase decision.

    Three in 10 shoppers said they would switch the type of vehicle they are considering, either from new to used, or certified pre-owned, or from imported models to domestically produced vehicles. And one in seven consumers would delay purchasing a vehicle until the tariffs are removed, with only seven per cent saying they would pay more an imported vehicle they liked.

    Other scheduled speakers include the ambassadors of the European Union, Canada and Mexico as well as Richard Smallwood, CEO of Sumitomo Rubber North America.

    Recommended for You
    Digital Edition
    Thumbnail
    View latest issue
    See our archive
    Sign up for free newsletters
    EMAIL ADDRESS

    Please enter a valid email address.

    Please enter your email address.

    Please select at least one newsletter to subscribe.

    You can unsubscribe at any time through links in these emails. For more information, see our Privacy Policy.

    Get Free Newsletters

    Sign up today for our Weekly Newsletter, Daily Newsletter and Breaking News Alerts. We'll deliver the news you need to know straight to your inbox.

    You can unsubscribe at any time through links in these emails. For more information, see our Privacy Policy.

    Subscribe Today

    An Automotive News Canada subscription includes 12 monthly issues – delivered in print to your doorstep, and digitally to your inbox – plus unlimited, 24/7 access to our website.

    Subscribe
    Connect With Us
    • Facebook
    • Twitter
    • Instagram

    Our Mission

    The Automotive News Canada mission is to be the primary source of industry news, data and understanding for the industry's decision-makers interested in Canada.

    Contact Us

    PO Box 243
    Station A
    Windsor, ON
    N9A 6K7

    1-877-812-1257

    Email Us

    Resources
    • About us
    • Contact Us
    • Digital Edition Archive
    • Advertise with Us
    • Reprints
    • Ad Choices Ad Choices
    • Sitemap
    Legal
    • Terms and Conditions
    • Privacy Policy
    Copyright © 1996-2019. Crain Communications, Inc. All Rights Reserved.
    • HOME
    • NEWS BY BRAND
      • Aston Martin
      • BMW
        • Mini
        • Rolls Royce
      • Daimler
        • Mercedes Benz
        • Smart
      • Fiat Chrysler
        • Alfa Romeo
        • Chrysler
        • Dodge
        • Ferrari
        • Fiat
        • Jeep
        • Lancia
        • Maserati
        • Ram
      • Ford
        • Lincoln
      • General Motors
        • Buick
        • Cadillac
        • Chevrolet
        • GMC
      • Honda
        • Acura
      • Hyundai
        • Kia
      • Mazda
      • Mitsubishi
      • Nissan
        • Infiniti
      • Subaru
      • Tata
        • Jaguar
        • Land Rover
      • Tesla
      • Toyota
        • Lexus
      • Volkswagen
        • Audi
        • Bentley
        • Bugatti
        • Lamborghini
        • Porsche
      • Volvo
    • News
      • Auto Shows
        • Toronto Auto Show
      • Photo Galleries
      • Automakers
      • Suppliers
      • Retail
      • Government Relations
      • Trade and Tariffs
      • Technology
      • Labour
    • Opinion
      • Blogs
    • EVENTS, WEBINARS & AWARDS
      • 2018 Auto News Canada All Stars
      • Best Dealership To Work For
      • Canada Congress
      • Webinars
    • +MORE
      • NEWSLETTERS
      • SUBSCRIBE
      • CLASSIFIEDS
      • CONTACT US
      • DIGITAL EDITION