Commercial secretary Wilbur Ross has until February to hand over his findings to the president. Photo credit: REUTERS
WASHINGTON – The Trump administration will for the time being refrain from imposing new tariffs for car imports, as senior officials are considering revisions of a report on the consequences for national security, two people familiar with the case told Bloomberg.
President Donald Trump met his top trade advisors at the White House on Tuesday to discuss a draft report on a trade department inquiry into the impact of car imports. The people who, on condition of anonymity, spoke because the meeting was not publicly announced, said that the administration was not ready to respond to rates and that the report would be subject to further changes.
The Commerce probe, which began in section 232 of the Trade Expansion Act in May, covers the import of cars, including SUVs, vans and light trucks, as well as car parts. Commercial secretary Wilbur Ross has until February to hand over his findings to the president, who has the last word on possible rates. Trump has threatened rates of no less than 25 percent on foreign-made vehicles.
Businesses and governments from Europe to Asia have warned Trump that tariffs for car imports would damage the US economy and disrupt the global automotive industry.
A car trade war would be a blow to car manufacturers from General Motors to Toyota Motor Corp., who built their supply chains to take advantage of low-rights countries. The National Automobile Dealers Association estimates that the rates would add as much as $ 2,270 to the cost of US built cars and $ 6,875 to the cost of imported cars & trucks.
Trump has 90 days after it has officially received the report to decide whether it should act if the department concludes that car imports pose a security risk. Companies can recommend all kinds of options to limit imports, including the implementation of tariffs and quotas. The president then has 15 days to act after he has announced that he will continue with measures.
Trump has agreed not to impose car tariffs on Europe, while the two parties are working on a trade agreement, and Canada and Mexico negotiated letters to the new US-Mexico-Canada agreement that will save them from new US duties on cars. ; s, depending on a limit.
Officials attending Tuesday's meeting at the White House were Ross, finance minister Steven Mnuchin, US sales representative Robert Lighthizer, Larry Kudlow, National Economic Council Director and senior adviser Jared Kushner.
Cecilia Malmstrom, Commissioner for Trade of the European Union, said Tuesday that Europe expects it to be exempted from new US car tariffs, at least temporarily.
"We assume that this is still valid," Malmstrom said, referring to a commitment by the US and the EU in July not to impose new tariffs on each other. She is in Washington this week to meet Lighthizer.
Malmstrom said there is enough common ground for a "limited" trade agreement between the US and the EU on industrial goods that exclude vehicles, agriculture and liquefied natural gas. The Trump government said in September that it wanted to conclude a formal trade agreement with the EU.
The US imported about $ 350 billion last year for cars and car parts.