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Administration must put the brakes on move toward dangerous foreign auto tariffs

For most Americans, the biggest purchase they’ll make in their lives is a home. Their next largest buy is the car they’ll park outside it.

Cars and trucks play an outsized role in the traditional American dream. Our cities and towns are designed around them, and ownership of one or two family-haulers is a pre-requisite for many busy parents looking for safe, convenient transport to work, school, and soccer practice. Our uniquely American love affair with the open road is long, established, and not something most politicians want to mess with.

{mosads}So why has the Trump administration proposed raising the price of these vehicles by 25 percent or more?

This week, the Department of Commerce, at the urging of the White House, launched a formal investigation into the national security threat posed by cars and trucks imported into the United States. If it sounds like a joke, it’s not. The administration is looking for a reason to label auto imports a security threat, as it did with steel and aluminum imports earlier this year. If it’s successful, American consumers can look forward to paying 25 percent more for their cars and trucks.

In case you’re breathing a sigh of relief because you don’t drive an import, think again. President Trump and Commerce Secretary Wilbur Ross mistakenly believe that by placing such an outrageously high tariff on autos they can control the free market, and force families to “buy American.” However, not a single vehicle for sale today is made with 100 percent American parts. This new tariff scheme will raise prices on ALL cars and trucks sold in America, even those built here, because it will apply to auto parts, as well as fully assembled vehicles.

The tariff strategy being proposed by the White House is a solution in search of a problem. Today’s auto industry is highly globalized and efficient – that’s what makes our products affordable to the average American. If Ford builds cars in Mexico and Honda builds trucks in Lincoln, Alabama, how can anyone determine what it means to be a ‘foreign’ car? What’s more, the auto industry in America is flourishing and production has doubled over the past decade. Not a single manufacturer is asking for the White House to “help” them out by making their products unaffordable and more difficult to attain for millions of Americans.

New tariffs, which are ultimately taxes on the American people, will punish international automakers that invest heavily in American facilities and workers. These companies are responsible for 1.29 million U.S. jobs, 32 manufacturing facilities, and $75 billion invested into operations. In 2016 they built 5.5 million vehicles – 47 percent of all U.S. vehicle production – and exported 925,000 of them. And, contrary to what many might think, America’s biggest auto exporter isn’t a domestic automaker like GM or Ford – it’s BMW, which builds all of its sport activity vehicles sold worldwide in Spartanburg, S.C.

If President Trump follows through on this latest tariff threat, he will be responsible not just for putting the price of a car out of reach for many American families, but also for creating a legacy of massive job loss. The 577,000 employees of America’s international nameplate dealers will be at risk, and so will the jobs of auto plant workers from 14 auto producing states – 12 of which voted for Trump in 2016. A recent study by the Trade Partnership found that a 25 percent tariff on imported vehicles would result in a net loss of 157,000 U.S. jobs. Those jobs count. They’re American jobs, held by American workers. To consider them anything less, and to dismiss them as collateral damage in an unnecessary trade war, is shocking.

Let’s get real: Cars aren’t a threat to our national security. But picking a trade war with our economic allies is. Today, before this ridiculous “security” charade gains any more momentum, America’s 9,600 international nameplate auto dealers are asking the president to pause and consider whether this trade war is worth the job losses and cost increases it will surely inflict upon American families.

Cody Lusk is president and CEO of American International Automobile Dealers (AIADA). 

Tags Donald Trump Wilbur Ross

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