Auto industry companies warn the new tariff from Trump will enhance costs and reduce vehicle sales

Written by David Shepardeson

WASHINGTON (Reuters) – The group, which represents General Motors Toyota and Volkswagen and other major auto companies that the head of the customs tariff is planning 25 % Donald Trump to impose next week on vehicles imported from American consumers.

“The additional definitions of costs on American consumers will increase, reduce the total number of vehicles that are sold inside the United States and reduce American auto exports – all before creating any new manufacturing or jobs in this country,” John Bouzella’s Innovation Alliance said in a statement.

The group represents every major car manufacturer, including Ford Motor, Hyundai, Stellantis, Honda, BMW and Mercedes-Benz.

Bozella said the group supports Trump’s goal of further production of cars in the United States.

“We are committed to building and investing in the United States, but these facilities and supply chains are huge and complex and cannot be transferred or re -directed overnight.”

The White House did not comment immediately.

“It is possible that the effects of definitions will be important in our industry – which affects car manufacturers, suppliers, merchants and clients,” said Jim Farley, CEO of Ford employees in an email on Friday.

Despite the fact that more than 80 % of the vehicles that Ford sells in the United States are assembled in America, “this does not mean that Ford is immune to the impact of definitions, which may be meaningful,” Farley added.

Other questions remain open, including whether Trump will extend a 25 % tariff earlier this month on vehicles collected in North America that are not exported under a free trade agreement, and if next week, it will impose a mutual tariff on the European Union and other customs tariffs.

The White House said on Wednesday that it is expected that the new definitions on cars and auto parts will collect 100 billion dollars in the next year.

Car industry companies may publish the cost of customs tariffs between the models produced by the United States and the importer, reduce features, and in some cases, they stop selling models at reasonable prices targeting car buyers for the first time, as many of these features are imported and less attractive if they carry a higher price.

(Participated in the reports of David Shepardeson; edited by Esteri Bell)