By on January 31, 2019

us-capitol, public domain

With the United States’ government shutdown now over, lawmakers have an opportunity to work together as promised. Interestingly, one of the first pieces of bipartisan legislation to emerge after the federal bureaucracy resumed operations involves a plan to severely limit presidential authority to impose tariffs for national security reasons.

The Bicameral Congressional Trade Authority Act, introduced by Senators Patrick Toomey (R-PA) and Mark Warner (D-VA), along with House Representatives Mike Gallagher (R-WI) and Ron Kind (D-WI), would require the president to get approval from Congress before taking any trade actions based on national security threats. If passed into law, the bill would let the Legislative Branch effectively block the tariffs being proposed by the Trump administration on automobiles and automotive parts.  (Read More…)

By on December 14, 2018

China announced Friday its intent to reduce tariffs on imports of American-made cars as it tries to negotiate a trade deal with the United States. As you’ll recall, the People’s Republic imposed additional punitive tariffs on U.S. cars and auto parts earlier this year after promising it would lower the trade barriers on a global scale.

Things look to be different this time around. China has already taken steps to scale back the trade war and appears ready to continue down that path. Earlier this month, President Donald Trump and Chinese President Xi Jinping agreed to a truce in the trade war at their meeting in Argentina. This was followed by an announcement, via Trump’s Twitter account, claiming China had agreed to scale back auto tariffs against the United States(Read More…)

By on December 3, 2018

Trump

Last night President Donald Trump tweeted that China had agreed to reduce tariffs. While The People’s Republic already lowered tariffs over the summer, it chose to cut the United States out of that deal as trade relations worsened. In fact, America found itself subject to an increased, 40-percent fine on imported autos while the rest of the world saw their tariffs (partially) eased. But the president seems optimistic.

“My meeting in Argentina with President Xi of China was an extraordinary one,” Trump explained in a follow-up post. “Relations with China have taken a BIG leap forward! Very good things will happen. We are dealing from great strength, but China likewise has much to gain if and when a deal is completed. Level the field!”

Meanwhile, China remains silent on the matter.  (Read More…)

By on November 16, 2018

It’s been a trade-heavy week. Earlier, the White House decided to postpone any major tariff decisions following a discussion with the Commerce Department over a draft report on the impact of auto imports, giving trade representatives from the United States and European Union room to talk.

Unfortunately, things don’t appear to have gone swimmingly. European Trade Commissioner Cecilia Malmström left her Wednesday meeting with U.S. Trade Representative Robert Lighthizer promising that the EU would have retaliatory tariffs at the ready if America pulls the trigger on auto import duties. However, she also said some progress was made during her talk with Lighthizer, but had nothing conclusive to announce

Negotiating with the EU has grown difficult and, frankly, the automotive aspects have become less important of late. The European Union is now discussing the possibility of creating its own army, leaving president Trump to tweet angrily about historical precedents.  (Read More…)

By on November 14, 2018

The Trump administration was supposed to make an announcement Tuesday as to whether or not imported automobiles pose a national security risk, following discussions with trade representatives. While it wasn’t presumed that the White House would say anything truly definitive or hold a formal press conference on the issue, it was assumed that the president would take a stronger public stance either for or against an earlier proposal to raise foreign auto import tariffs to 25 percent. And it has, in a way.

According to those familiar with the matter, the White House decided to postpone any major decisions after discussing a draft Commerce Department report on the impact of auto imports with trade reps. However, the administration doesn’t have forever to make up its mind. Nor does its trading partners, which could be the point.  (Read More…)

By on November 13, 2018

infiniti nissan factory japan

The U.S. Commerce Department has submitted draft recommendations to the White House on its investigation into whether it’s prudent to impose tariffs of up to 25 percent on imported automobiles and parts, based on the premise that they’re a threat to national security. The possibility has the industry in a tizzy, with both foreign and domestic brands lobbying against it.

Truth be told, we half assumed the entire concept was a ruse to bring other nations to the bargaining table with something to lose — a scenario where the United States could be viewed as a favorable alternative to tariff-crazy China. However, China has begun opening its market to foreign automakers while also placing a massive 40 percent duty on American autos, leaving the U.S. at a disadvantage. Now it looks as if the Trump administration may go through with everything.  (Read More…)

By on October 23, 2018

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Ford Motor Co. is blaming Donald Trump’s commodity tariffs for elevating U.S. steel prices higher than any other market on the planet. Regardless of your opinion on the president’s policies (the economy is reportedly booming), it’s a little hard to rebuff Ford’s criticisms on this one. The automaker’s now going straight to the source in an attempt to remedy the situation.

Trump hasn’t gone easy on Ford. He spent a large portion of his presidential campaign coming down on the automaker over its plan to move small-car production to Mexico. However, the company’s about-face proved a short-lived victory — it ultimately decided to stop selling cars altogether. This was followed by Ford’s cull of the upcoming Focus Active in North America after Trump’s 25 percent levy on Chinese-built vehicle made the introduction impossible (and unprofitable).  (Read More…)

By on September 26, 2018

Canadian Prime Minister Justin Trudeau ignored mounting pressure from the United States to quickly agree to a new NAFTA deal on Wednesday. Trudeau indicated it was possible for the three nations to maintain a trilateral agreement, but noted his priorities would always align with what’s best for Canada. The nation now seems fine with ditching the agreement altogether.

Meanwhile, U.S. President Donald Trump announced that an agreement reached with Japanese Prime Minister Shinzo Abe allows the two countries to begin trade negotiations. The focus of these talks will likely be automotive in nature. Trump has remained oddly fixated with convincing Japan to sell more American-made models ever since taking office, and the Land of the Rising Sun doesn’t want itself saddled with import tariffs.  (Read More…)

By on September 25, 2018

FCA Windsor minivan assembly Dodge Grand Caravan 2011 - Image: FCA

U.S. Trade Representative Robert Lighthizer has said the United States will begin moving forward on its bilateral trade deal with Mexico at the risk of leaving Canada behind.

The nation was already given until the end of September to reach an agreement that would effectively maintain the existence North American Free Trade Agreement, but has not indicated satisfaction with the current terms. Unfortunately, the U.S. wants to ensure a deal is in place before the next Mexican president assumes office — giving it precious little time to spend on Canada after the last year’s worth of negotiations proved ineffective.

“If we push it beyond [October 1st], then we have a new negotiation with Lopez Obrador and we don’t know where that would go at all,” Lighthizer said. “It would be unfair to all the people that have been involved — certainly the U.S. workers, farmers and ranchers — to start a new negotiation with a new president of Mexico.”  (Read More…)

By on September 21, 2018

nafta-secretariat

The United States is getting extremely close to having to move forward on its NAFTA deal with Mexico without Canada, according to White House economic adviser Kevin Hassett.

“I’m a little surprised that the Canadians haven’t signed up yet,” Hassett said in an interview with Fox News. “I worry that politics in Canada is trumping common sense because there’s a very good deal that was designed by Mexico and the U.S. to appeal to Canada. And they’re not signing up and it’s got everybody over here a little bit puzzled.”

On Thursday, Canadian Foreign Minister Chrystia Freeland and U.S. Trade Representative Robert Lighthizer met in Washington to discuss terms. However, no agreement was reached.  (Read More…)

By on August 31, 2018

Donald Trump, public domain

Earlier this year, President Donald Trump took a renewed interest in European tariffs after deciding he didn’t like what he saw. He argued it was time for the United States to consider a fresh tax on vehicles manufactured in the European Union to level the playing field. “If the EU wants to further increase their already massive tariffs and barriers on U.S. companies doing business there, we will simply apply a tax on their cars which freely pour into the U.S.,” he wrote in March.

A few months later, America floated the ridiculous-sounding proposal of abolishing all automotive tariffs between the U.S. and EU. Surprisingly, Europe was highly receptive. German Chancellor Angela Merkel even directly addressed the issue by saying she would support lowering EU tariffs on U.S. car imports. The European Union now seems willing to pursue a zero-tariff solution on automobiles.

However, Trump has since changed his tune. The new rhetoric coming from the White House is that the deal, which was originally pitched by the U.S., is no longer good enough.  (Read More…)

By on August 15, 2018

In Joseph Conrad’s Heart of Darkness, Kurtz has an epiphany regarding himself, imperial conquest, and war as a whole, crying “The horror! The horror!” in his last moments of life. His experiences took him from a well-meaning businessman to a megalomaniacal warlord, only able to realize the full scope of his own corruption upon his death. Trade wars contain significantly less drama than real ones, but there is never a shortage of egotistical individuals falling down a rabbit hole of madness.

This week, a decree signed by Turkish President Recep Tayyip Erdogan raised the tariff on U.S. cars to 120 percent. While this doesn’t qualify as truly horrific, it certainly could head in that direction if things continue to escalate.  (Read More…)

By on August 10, 2018

Mercedes-Benz sport-utility vehicles assembled in Tuscaloosa, Alabama, are being checked for potential problems by Chinese customs authorities in Shanghai, according to the nation’s media. The situation was later confirmed by Daimler AG on Thursday.

Officially, custom agents discovered the imported GLE and GLS models possess “insufficient” rear brakes and pose a safety risk. However, this isn’t China’s first time holding up product from the Tuscaloosa factory. Daimler confirmed that its American-made SUVs, along with vehicles from Ford, were held up for several weeks in late April.  (Read More…)

By on August 5, 2018

Image: GM

We previously reported that General Motors was seeking an exemption from U.S. tariffs that could affect the domestic wellbeing of the Buick Envision, the brand’s Chinese-made utility vehicle positioned between the Encore and Enclave. At the time, GM hadn’t weighed in on if it would pull the model from the United States if it didn’t get a pass into the country.

Since then, General Motors President Dan Ammanm has said the exception is the only way the automaker sees itself being able to continue selling the model in America. The automaker confirmed that the Envision’s domestic sales are insufficient to rationalize U.S. production but noted GM needed the model to have a complete lineup against brands like Audi, Lexus, and Mercedes-Benz.

Mercedes-Benz… Seriously(Read More…)

By on August 3, 2018

Image: GM China

General Motors wants an exemption from a 25 percent U.S. tariff for the Buick Envision, the Chinese-made sport utility positioned between the Encore and Enclave. On Thursday, the automaker said it filed the request on July 30th with the U.S. Trade Representative to exclude the model from the prospective Section 301 tariff on products shipped from China.

The Envision hasn’t been a strong seller in the United States. While it managed to move 41,040 units in 2017, this year is not on track to meet that number. Obviously, the model has had some troubles. Early reviews were unfavorable, often accusing the Envision of being a faux luxury vehicle with an overly ambitious price tag. However, the manufacturer has since dropped the price and updated the vehicle for the 2019 model year.

Unfortunately, enough damage was dealt in those first two years to make the new model look less appetizing to customers. It now holds the stigma of an overpriced, Chinese-made compact crossover that falls short just about everywhere. It needs time to rebuild its image after the refresh, and it won’t be able to manage that if it is taxed into oblivion.  (Read More…)

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