National Security Investigation Into Imports Complete, Could Cause New Car Prices To Climb $2,750
BY MICHAEL GAUTHIER | POSTED ON FEBRUARY 18, 2019
It’s been nearly a year since President Trump ordered the Department of Commerce to conduct an investigation into whether or not imported vehicles and parts are a threat to the national security of the United States.
The investigation is now over and Reuters says the report was submitted to the White House less than two hours before it was due. The department is keeping details under wraps, but President Trump has 90 days to consider taking action based on recommendations made in the report.
There’s no word on what recommendations are in the report but, when the investigation was launched, the Department of Commerce said the number of automotive production jobs in the United States has fallen by 22 percent, since 1990, “even though Americans are continuing to purchase automobiles at record levels.” The department also noted the number of imported passenger vehicles has jumped 16 percent in the past 20 years.
It remains unclear what will happen next, but many observers believe the Trump administration will use the report to justify slapping tariffs on imported vehicles
. There’s still a lot of uncertainly, but possible recommendations could include tariffs of 20-25 percent on imported vehicles and parts or more targeted tariffs on electric and autonomous vehicles.
A number of companies have been critical of the proposed tariffs and Toyota has previously called them “a tax on consumers, [which] would increase the cost of every vehicle sold in the country.” With tariffs of 25 percent, the automaker suggested the price of the American-made Camry would jump by $1,800 (£1,392 / £1,591).
More recently, the Center for Automotive Research (PDF) released a report that suggested tariffs could cost up to 366,900 jobs in the United States including those of up to 77,000 dealership employees. The report also suggested the average price of a new vehicle could climb by $2,750 (£2,126 / £2,431) and this could cause new vehicle sales to plummet by up to 1.3 million units annually.