Japanese Automakers: Trump's Steel Tariff Will Cost You More at the Dealership

Earlier this month, President Trump signed an executive order imposing a 25 percent tariff on foreign steel and a 10 percent tariff on foreign aluminum. Hoping to receive an exception, the Japanese auto lobby warned that the U.S. import tax would definitely inflate the price of models built by the companies it represents. That’s bad news.

However, the White House has already omitted its NAFTA partners from the tariffs, adding that it would consider further exceptions based on countries’ contributions to U.S. national security, military alliances, trading history, and how much they pay into strategic alliances like NATO.

While Japan is a longtime trading partner with the U.S., there currently exists a $69 billion deficit between the two countries. Trump also bemoaned Japan’s unwillingness to accept American imports. Still, the two have shared military alliances throughout the 20th century, with one ugly exception during World War II. They currently operate under the Treaty of Mutual Cooperation and Security and the U.S. currently considers the Japan one of its closest allies, despite it not being a NATO member — placing it in reasonably positive standing for tariff exceptions.

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What's Standing Between You and a Future Citron or Peugeot? Possibly, a Tariff

The threat of new import tariffs has PSA Group worried about its plan to return to the United States. Following President Trump’s proposal to levy a 25-percent tax on steel imports and a 10-percent tariff on inbound aluminum, Europe balked at the suggestion, leading to further threats of a car tariff.

Right now, the U.S. levies a 2.5-percent tax on imported European vehicles, far less than Europe’s 10-percent tariff on vehicle travelling eastward across the Atlantic. There’s a 25-percent U.S. tariff on European vans and trucks, too, which explains why crates of Mercedes-Benz van components sail into the port of Charleston, South Carolina at regular intervals.

According to Trump, any European retaliation against the proposed metal tariffs — which seem all the more likely given yesterday’s resignation of the president’s pro-free trade economic advisor, Gary Cohn — would see the U.S. ratchet up its car tariff. If the scenario comes to pass, your dreams of one day buying a new French car in America could easily be dashed.

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  • FreedMike On the one hand, it doesn't look good. On the other hand, not releasing the car into the hands of the general public until the obvious bugs are worked out is a good idea for a brand new company. Time will tell.
  • FreedMike I do take phone calls using Car Play if I'm not in traffic; it's a little bit of a distraction, but not much. I think it's certainly within an acceptable risk margin if you're not in heavy traffic. Back in the old days when I had a manual car and no Bluetooth, I never used the phone while driving at all.
  • FreedMike I guess some folks are just bound and determined to drive around with a grenade in their steering wheel.
  • FreedMike Bit dear, but these might have collector appeal, particularly one with 20,000 miles (assuming that's not a doctored figure) that hasn't had the full "whip" treatment.
  • Adam4562 I have Bluetooth in my car , the name comes up and I answer . It goes through the speaker. I’ll text on a stop sign or red light . If it’s really urgent hill pull over .