Tariffs create uncertainty in the auto industry

Trump administration rates could hurt the car and truck industry more than help, told CNBC veteran of the automotive industry Jim Press [19659002] div> div.group> p: first-child "/>

"The reality is that tariffs do not normally go away once they are adopted," said Jim Press on " Closing Bell " on Friday. "This is not a trading tactic, and it causes a lot of uncertainty in investment decisions, production decisions, product design, and it's a very difficult situation." for car manufacturers. "

US Chinese goods duties of $ 34 billion came into effect at 12:01 pm Eastern time on Friday. China immediately introduced retaliatory tariffs. Beijing has called the "biggest trade war in economic history."

Chinese tariffs will have an impact on a number of US sectors, including agricultural products and automobiles. Now, vehicles built in the United States and sold overseas are subject to rates of up to 40%. Vehicles manufactured in China and sold in the United States, however, pay only a rate of 25%. In addition, China imports fewer cars in the United States than the other way round.

The United States exported 267,000 automobiles to China last year and has a trade surplus of $ 6.4 billion. dollars in the automotive sector with China. of our cars in China, we do not manufacture the kind of vehicles that the Chinese would use on their roads with their fuel economy, "said Press, who is now president of RML Automotive.

how car manufacturers in the United States will face higher prices. Mercedes-Benz, which builds SUVs in Alabama, has not yet said how it will solve the problem. BMW, however, said the tariffs would affect the retail prices of models shipped from South Carolina to China. Tesla also said in a note to consumers in China that they should expect higher prices.

Press, who has spent more than four decades in the automotive industry, including tenures at Toyota, Ford Motor Company, General Motors and Chevrolet, as well as as co-president and vice president of Chrysler he said that nothing good comes out of trade wars.

"The results are normally bad," he said. "In this case, the current situation in the US auto industry does not really warrant it, but it may be a political effort to try to put pressure on China, but I do not see how that will help American consumers. " 19659010] [ad_2]
Source link