Economy

Mazda Protests Trump's Tariffs on Behalf of 32000 Americans

Mazda Protests Trump's Tariffs on Behalf of 32000 Americans”

The Trump administration in May launched an investigation into whether imported vehicles posed a national security threat, and US President Donald Trump has repeatedly threatened to quickly impose a 20 per cent import tariff on vehicles. However, with its brand presence steadily increasing, Mazda is also looking to increase its American-based operations and has begun construction of a new auto factory in Huntsville, Alabama (something Trump would probably like to take credit for, as he did when another automaker announced a new investment in U.S. operations).

On Wednesday, two major auto trade groups said imposing up to 25 percent tariffs on imported vehicles would cost hundreds of thousands of auto jobs, dramatically hike prices on vehicles and threaten industry spending on self-driving cars.

The U.S. automaker warned that an escalating trade war could backfire and lead to "less investment, fewer jobs and lower wages".

"The carry-on effect of less investment and a smaller workforce could delay breakthrough technologies", it said.

"The correlation between a decline in vehicle sales in the United States and the negative impact on our workforce here, which, in turn threatens jobs in the supply base and surrounding communities, can not be ignored".

"We are an exemplar of the manufacturing might of America", the company stated. Similarly, a third of Honda vehicles delivered in the USA throughout 2017 were built overseas.

GM's Chevrolet Silverado pickup was the top-selling model imported from Mexico past year, while the Chevrolet Equinox crossover was the leading vehicle sourced from Canada, according to LMC Automotive.

"It is now also increasingly clear that the way the steel and aluminium tariffs have been used will result in retaliatory tariffs from our largest trading partners and closest allies, and that retaliation will have serious negative economic impacts on the United States", they wrote in a letter to USA senators. It also warned that retaliatory moves by governments in other key markets would hurt its overseas business.Last year, about 36% of GM's USA sales were imported, or about 1.1 million vehicles, according to research firm LMC Automotive.

Some aides have said that Trump is pursuing the national security probe to put pressure on Canada and Mexico to agree to concessions in talks to renegotiate the North American Free Trade Agreement.

Trump's proposal "risks undermining GM's competitiveness against foreign auto producers by erecting broad brush trade barriers that increase our global costs" and could invite retaliation by USA trading partners, the automaker said.

GM says it has 110,000 employees working at 47 manufacturing locations and 25 parts and service facilities in the U.S. The company says it most of its R&D, design, and engineering work happens in the U.S., too. China has also responded by taxing imports from the US.

Toyota noted that global carmakers assembling vehicles in the United States are based in countries including Japan, German and South Korea "that are America's closest allies".

"Engaging in trade wars with our allies would diminish, not enhance, US national security, jobs, and prosperity, and undermine the rules-based global trading system, which has led to a period of unparalleled peace and prosperity in Europe and Asia for the last half-century", Toyota wrote in a comment letter to Commerce Secretary Wilbur Ross.

The Department of Commerce is now accepting rebuttal comments for responses already submitted until July 6, and will hold public consultations in Washington in July. The input "will enable us to make our best informed recommendation to the President", he said.



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