Car Dealers Tell Commerce Department That Tariffs are Taxes on Consumers

Department studying if imported autos risk national security.

by on Jun.29, 2018

AIADA's Cody Lusk chastised the Trump administration in a filing, saying a new tariff amounts to a new tax on the American people.

This country’s international auto dealers, who sell brands from Asia and Europe, fired a broadside shot against the Trump administration’s plans to impose a heavy tariff on cars imported into the U.S.

America’s auto dealers, domestic and international, stand to lose up to 2 million annual sales if the investigation rules against their products and the 25% tariff proposed by the Trump administration is put in place, the American International Auto Dealers Association said.

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The AIADA comments were filed with the Department of Commerce’s Section 232 investigation into whether or not imported autos and auto parts, used in every car sold in America, pose a national security threat to the United States.

President Donald Trump asked the Commerce Department to conduct the investigation, which Secretary Wilbur Ross said recently should be completed by the end of summer. If they are found to pose a national security threat, Trump can implement the tariff without the approval of the U.S. Congress.

(Automakers foreign and domestic: tariffs harm jobs, economy. Click Here for the story.)

Commerce Secretary Wilbur Ross said the study determining if automotive imports could be declared a threat to national security.

The dealers, who were ardent Trump supporters two years ago, observed that “maintaining high employment and an atmosphere for business investment is crucial to creating a strong economy that is vital to national security.”

AIADA’s international nameplate dealers see new opportunities to grow and thrive in this economy, but worry that the possible tariff will negatively affect their ability to operate and provide work for thousands of Americans, the comment added.

“Tariffs are taxes, and a 25% tariff on all imported vehicles and vehicle parts amounts to a massive new tax on the American people. On average they would pay an extra $6,400 on a vehicle that currently costs $30,000,” said AIADA President and CEO Cody Lusk.

“Autos and auto parts aren’t a national security threat, but tariffs are a real and dangerous threat to our economy. America’s international nameplate dealers and their 577,000 employees strongly support a pro-growth economic agenda and believe it can be accomplished with a positive trade message, not the threat of tariffs and taxes,” Lusk said.

(Click Here to see how “nearly every segment of auto industry” is threatened by Trump trade tactics.)

Canadian Prime Minister Justin Trudeau told President Donald Trump that the idea that Canadian auto parts were risks to national security was offensive.

In 2016 alone, 5.5 million vehicles were built by the American employees of international nameplate manufacturers in the U.S., of which 925,000 were exported to more than 140 countries worldwide. International automakers directly and indirectly employ 1.29 million Americans and exports of international autos alone supported 265,000 US jobs.

In fact, according to data from the U.S. Department of Commerce, in 2017, the BMW Manufacturing factory in South Carolina was the leading U.S. automotive exporter by value. AIADA highlights all this information to ensure that the department is aware of the economic impact of international auto dealers and automakers in every state and every community in the United States.

America’s 9,600 international nameplate auto franchises, many of which are family-owned businesses, employ more than 577,000 Americans, resulting in a payroll of $32 billion and an additional 527,000 indirect jobs. Last year, they sold 9.6 million vehicles to American consumers – 55.6% of total U.S. retail vehicle sales.

(To see more about Trump’s auto tariff threat triggering backlash, Click Here.)

AIADA represents America’s international nameplate automobile franchises that sell Acura, Aston Martin, Audi, Bentley, BMW, Ferrari, Genesis, Honda, Hyundai, Infiniti, Jaguar, Kia, Land Rover, Lexus, Maserati, Mazda, Mercedes, Mini, Mitsubishi, Nissan, Porsche, Rolls Royce, Smart, Subaru, Toyota, Volkswagen and Volvo.

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2 Responses to “Car Dealers Tell Commerce Department That Tariffs are Taxes on Consumers”

  1. Fred says:

    Citing “national security” as the basis for the tariffs makes one wonder how that can be accepted by the various agencies. Given the CBO’s report on the effect of the recent tax “reform” (“explode our trade deficit”) that came out Thursday, perhaps the danger to our national security is being misidentified.

  2. Dave Suton says:

    Don’t worry. All of those “potential” lost sales will go back to American Headquartered Brands. So the money wont be lost to “international” (meaning NOT AMERICAN) brands. And have a better chance of staying here to help our citizens.