March 02, 2018
Associations representing manufacturers of light-duty vehicles and heavier trucks have spoken out against President Donald Trump’s plan to place a 25% tariff on steel and a 10% tariff on aluminum imports.
Both metals are crucial to the production of cars and trucks sold in America today and could raise the sale prices of those vehicles substantially.
In addition to paying more for their vehicles, American consumers and workers can also expect to bear the brunt of the retaliatory tariffs other countries will almost certainly place on goods manufactured and exported from the U.S., said Cody Lusk, president and chief executive of the American International Automobile Dealers Association (AIADA).
“These proposed tariffs on steel and aluminum imports couldn’t come at a worse time,” Lusk said. “Auto sales have flattened in recent months, and manufacturers are not prepared to absorb a sharp increase in the cost to build cars and trucks in America. The burden of these tariffs, as always, will be passed on to the American consumer. Car shoppers looking for a deal will instead find that they are paying a new tax to transport themselves and their families.”
The Motor & Equipment Manufacturers Association (MEMA) also expressed opposition to the plan. MEMA represents more than 1,000 companies that manufacture vehicle parts and components.
“The tariffs announced on March 1 will be detrimental to the motor vehicle parts supplier industry and the 871,000 U.S. jobs it directly creates,” said Steve Handschuh, MEMA’s president and CEO. “We have voiced repeatedly that while we support the administration’s focus on strong domestic steel and aluminum markets, tariffs limit access to necessary specialty products, raise the cost of motor vehicles to consumers, and impair the industry’s ability to compete in the global marketplace. This is not a step in the right direction.”
Steel and aluminum tariffs could directly counteract any benefits American manufacturers have seen from tax and regulatory reform. An analysis of tariffs on steel imposed in 2002 found that the Bush steel tariffs cost 200,000 jobs, including 30,000 in Michigan, Ohio and Pennsylvania alone, Lusk added.