Trump hints at new auto tariffs after GM closures, job cuts

The US president Donald Trump, talks with the Prime Minister of Japan Shinzo Abe, in the presence of the Spanish Prime Minister Pedro Sánchez and the Prime Minister from Canada Justin Trudeau (seco

Trump noted on Twitter that brisk US small truck sales in the country are due to a 25-percent tariff on small truck imports.

The United States now has a 2.5 percent tariff on imported cars and sport utility vehicles from markets outside North America and South Korea.

In a series of tweets, Trump said that plans to introduce auto tariffs are now being studied.

A 25-per-cent duty on imported light trucks was applied in the 1960s by President Lyndon Johnson in retaliation to West German tariffs on US poultry.

Trump and Chinese leader Xi Jinping are due to meet on the sidelines of the Group of 20 summit in Buenos Aires on Friday. Media reports confirm the Trump administration remains very anxious about a consumer backlash to tariffs that will considerably raise the prices of popular electronic devices. Regardless of whether suppliers and OEMs continue to import steel from overseas or buy it domestically, they are paying more for steel to build their vehicle bodies.

"If we did that with cars coming in, many more cars would be built here", Mr Trump said, adding "and GM would not be closing their plants in Ohio, Michigan & Maryland".

"As the President has repeatedly noted, China's aggressive, State-directed industrial policies are causing severe harm to USA workers and manufacturers", Lighthizer said.

The "chicken tax" or "chicken tariff" the President mentioned in his tweet was imposed by the USA in the 1960s in response to a tariff by some European countries on American poultry exports. "As of yet, China has not come to the table with proposals for meaningful reform".

U.S. Trade Representative Robert Lighthizer will "examine all available tools to equalize the tariffs applied to automobiles", he said in a statement released Wednesday. The president is angry over the announcement Monday that GM plans to close plants and eliminate 14,000 jobs in North America.

Volvo recently announced a reduction to its hiring plans and scaling back on the auto company's new assembly plant near Charleston, South Carolina, as a result of the impending higher auto tariffs. The United States slapped an additional 25 percent tariff on Chinese-made vehicles earlier this year, prompting China to retaliate. China, on the other hand imposes a 40 per cent tariff on all United States manufactured cars.

The White House in recent weeks has reached out to the chief executives of German automakers including Daimler AG, BMW AG and Volkswagen AG about meeting to discuss the status of auto trade.



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