TPO – The administration of US President Donald Trump is preparing to make a decision to reduce taxes on imported auto parts and components, but still maintain taxes on cars manufactured abroad.
“President Trump is building an important partnership with our domestic automakers and our great American workers,” Commerce Secretary Howard Lutnick said in a statement released by the White House on April 28.
“This agreement is a major victory for the president’s trade policy by rewarding domestic manufacturing companies while providing a favorable environment for manufacturers who have committed to investing in the United States and expanding their production,” the statement said.
 |
|
A row of cars parked at the port of Baltimore, Maryland, USA. (Photo: Reuters) |
Automakers have said they expect President Trump to issue an auto tariff exemption when he visits Michigan, home to three Detroit automakers and more than 1,000 auto suppliers.
Last week, a coalition of auto industry groups urged Mr Trump not to impose a 25% tariff on imported auto parts , warning that it would reduce sales and raise prices. Mr Trump had previously said he would impose a 25% tariff on auto parts by May 3.
“Tariffs on auto parts would disrupt the global auto supply chain, creating a domino effect that would result in higher prices for consumers, lower sales at dealerships, and higher repair costs,” the industry groups warned in a letter.
The letter from groups representing General Motors, Toyota Motor, Volkswagen, Hyundai and others was sent to U.S. Trade Representative Jamieson Greer, Treasury Secretary Scott Bessent and Secretary Lutnick.
“Most auto suppliers are not prepared to deal with the sudden disruption caused by tariffs. Many are struggling and will face the risk of production shutdowns, layoffs and bankruptcy,” the letter said.
They say that just one supplier failure can lead to the shutdown of an entire automaker’s production line.
