Trump administration orders probe to consider tariffs on automobile imports
What's the story
US President Donald Trump today ordered an investigation into the import of automobiles, including trucks, and auto parts, to determine their effects on the US national security, a move that may lead to the imposition of new tariffs on foreign-manufactured automobiles.
Trump instructed US Commerce Secretary Wilbur Ross to consider initiating an investigation under Section 232 of the 1962 Trade Expansion Act.
Here's more.
Information
Trump introduced tariffs on steel and aluminum in March
In March, the Trump Administration had used the same legal justification to slap steep tariffs of 25% on steel and 10% on aluminum imports. The administration had also threatened tariffs on Chinese goods over intellectual property complaints.
National security
Investigation would determine whether vehicle-imports threaten to impair US security
The investigation will determine whether imports of automobiles, including sports utility vehicles (SUVs), van and light trucks, and automotive parts into the US threaten to impair the national security.
"Core industries such as automobiles and automotive parts are critical to our strength as a nation," Trump said.
Ross has sent a letter to Secretary of Defense James Mattis informing him of the investigation.
Erosion of industry
Imports from abroad have eroded US's domestic auto industry
For decades, Ross claimed, the imports from abroad have eroded their domestic auto industry.
During the past 20 years, imports of passenger vehicles grew from 32% of cars sold in the US to 48%.
From 1990 to 2017, employment in motor vehicle production declined by 22%.
American-owned vehicle manufacturers in US account for only 20% and American auto part manufacturers account for 7% only.
Investigation
Will conduct a thorough, fair, and transparent investigation: US
Ross said the Department of Commerce will conduct a thorough, fair, and transparent investigation.
The investigation will determine whether the decline of the domestic automobile, automotive parts' production threatens to weaken the US's internal economy by potentially reducing research, development, and jobs for skilled workers in connected vehicle systems, autonomous vehicles, fuel cells, electric motors and storage, advanced manufacturing processes, and other cutting-edge technologies.