Auto Industry Brakes For Tariffs

May 17, 2019

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The Ohio Valley auto industry is still awaiting a decision on whether or not they’ll face tariffs. The Trump administration was scheduled to make a decision this month, but punted for another six months.

Executive Director of the Kentucky Automotive Industry Association Dave Tatman said this adds to the uncertainty his industry faces.

“But we have three huge destabilizers for the economy in which we work. The tariff trade war going on with China, the whole potential of national security threat and however that plays itself out and there’s some new information on that, and then the USMCA agreement,” he said.

The Commerce Department submitted its recommendations to the Trump administration on whether the global auto industry poses a national security risk, thus justifying tariffs on imports. The president then had 90 days to decide what to do. Now the White House has extended that deadline by six months. Tatman said the uncertainty is leading manufacturers to hold off on investment.

“When you have huge uncertainty it causes a lot of pullback on new investment, new hiring and all the kinds of things that we ought to be a part of,” he said.

Tatman said the auto industry is not a national security threat and actually depends on a global market in order to make vehicles. He said many parts cross the U.S. border six or seven times before being put into a car or truck.