Auto industry sounds off on car tariffs
WASHINGTON - Automakers, dealers and suppliers are getting their chance to tell the Commerce Department what they think of President Donald Trump's proposed tariffs on imported cars, trucks and auto parts. And it's clear they're united in being firmly against the plan.
"The opposition is widespread and deep because the consequences are alarming," Jennifer Thomas of the Alliance of Automobile Manufacturers told a Commerce Department hearing on the tariffs Thursday.
Mr. Trump has ordered the department to investigate whether auto imports pose a threat to U.S. national security that would justify tariffs. But automakers say the tariffs would drive up the cost of imported components and would invite retaliation by US. trading partners.
In a study out Thursday, the Center for Automotive Research found that a 25 percent tariff on autos and parts would cut U.S. auto sales by 2 million and wipe out 714,700 jobs.
Imposing a 25 percent tariff on auto imports would raise the price of the typical new car sold in the U.S. (now about $35,000) by $4,400. That's $2,270 for U.S.-built cars and $6,875 for imported cars and trucks, according to a study released Thursday by the Center for Automotive Research.
"New tariffs or quotas would also reduce competition and consumer choice, increase the cost of used vehicles and raise the cost of getting vehicles serviced and repaired," said Peter Welch, president of the National Automobile Dealers Association, which commissioned the study.
Welch said the tariffs would push the average new-car payment to $611 a month from $533 a month (over a 69-month loan term on average).
With the Commerce Department on Thursday starting two days of hearings to consider the plan, bets are Mr. Trump will enact the tariffs anyway – despite the industry's opposition. UBS strategists expect the U.S. to impose the car levies by year-end (though not on auto parts).
