Mazda condemns Trump’s car-tariff plans

Bloomberg

Mazda Motor Corp. became the latest auto company to condemn the Trump administration’s plans for potential car import tariffs, saying such duties would hit both the industry as well as US consumers.
The Japanese manufacturer said it filed comments on the Commerce Department’s investigation into car-related imports, urging it to “reject the premise that auto imports are a threat to national security.”
Mazda’s US unit said in a statement it filed the comments on behalf of 32,000 Americans who work for Mazda and the brand’s dealerships.
The car industry is intensifying its push against the potential tariffs, part of a looming trade war. The duties would make imported cars more expensive, while also potentially hitting US producers by making parts sourced from other countries pricier.
“A tariff is a tax and it will be paid by American consumers,” Mazda said. “It will significantly increase the cost of every new vehicle sold in America, regardless of where it is built.”
The carmaker currently imports all vehicles it sells in the US, mostly from Japan and Mexico, and is building a new auto factory in Huntsville, Alabama, with Toyota Motor Corp.
Mazda projects that its US sales will rise 4 percent to 317,000 units in the year ending March, 2019.
Toyota also said it submitted comments to the Commerce Department. “A 25 percent tariff on automotive imports, which is just a tax on consumers, would increase the cost of every vehicle sold in the country.
Even the Toyota Camry, the best-selling car in America, made in Georgetown, Kentucky, would face $1,800 in increased costs,” Toyota said in a statement.
The Association of Global Automakers, a Washington-based trade group that represents car manufacturers and parts suppliers based outside the US, called the potential duties “the greatest threat to the US automotive industry at this time.”
Other Japanese carmakers would also be hit by tariffs. A third of Honda Motor Co.’s cars sold in the US last year were imported, mostly from Canada and Mexico, and 48 percent of Nissan Motor Co. cars sold in the country were brought from countries including Mexico, Japan and South Korea.

Japan warns US auto tariffs may threaten ‘free trade’
Bloomberg

US trade restrictions, including threatened tariffs on cars and auto parts, would put “the global free trade system at great risk”, the Japanese government warned.
Japan didn’t explicitly threaten retaliatory measures if the US imposed tariffs or restrictions on car imports, but said “rebalancing measures” by other countries “might well result in damage to the US manufacturing and agricultural industries”.
Japan’s cautionary message to its longtime ally came in a public comment on the US Commerce Department’s investigation into whether imports of automobiles and auto parts pose a national security risk. President Donald Trump has threatened the EU with auto tariffs of 20 percent.
In its comment, Japan stressed its carmakers’ contributions to the US economy. It noted that Japanese automakers produce “as many as 3.8 million cars” in the US, many of which are subsequently exported. Any US trade restrictions “could seriously affect more than 1.5 million jobs created by Japanese auto-related companies in the US,” it said.
The Commerce Department investigation is being conducted under Section 232 of a 1960s trade law, the same tool Trump invoked in imposing global tariffs on imported steel and aluminum earlier this year.
If the department determines auto imports pose a security risk, Trump can impose import restrictions, including tariffs, without congressional approval.
A 25 percent tariff on Japanese autos and parts would amount a levy of about 1 trillion yen ($9.1 billion) annually, according to Bloomberg Economics’ Yuki Masujima.