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 Title Auto plastics supply chain warns against U.S. tariffs on imported cars and components
 Name 일반관리자  Date of Registration 2018-07-31
 Email  Hits  124
 Source www.plasticsnews.com, 편집 handler

Auto plastics supply chain warns against U.S. tariffs on imported cars and components




Gage Skidmore/WikipediaPresident Donald Trump, in a July 1 television interview, said tariffs would close the trade deficit in automobile production and result in more cars being made in the United States.


Washington ? Potential U.S. tariffs on automobiles and auto components are drawing strong opposition from some quarters of the plastics supply chain.

The American Chemistry Council, for example, told the Trump administration in a government filing June 29 it would invite “swift and brutal” retaliation against growing U.S. plastics and chemical exports.

Plastics parts makers also expressed worry. The U.S. operations of Canadian injection molder Mitchell Plastics said it was “deeply troubled” by tariffs and feared they could ultimately result in higher prices that drive down auto sales.

And Japanese plastics processor Toyoda Gosei Co. Ltd., which has 10 factories in the United States, said trade barriers would hurt its 5,300 workers in the U.S. and hamper future investment.

But it wasn’t all against tariffs: The United Steelworkers union, which also represents some plastics industry employees, urged focusing on imported cars and components from Germany, Japan, Mexico and South Korea and said technologies critical to national defense have historically come from the auto sector.

Those are among more than 2,300 comments that have poured into Washington in recent days in response to a formal Trump administration investigation into tariffs on automobiles, including cars, SUVs, vans and light trucks, and on auto parts. Hearings are set for July 19-20.

President Donald Trump is pursuing the investigation under what’s called Section 232 of U.S. trade laws, which gives the president latitude to enact measures like tariffs to protect areas deemed vital to the defense industrial base, although some comments questioned the link between national security and the car industry, noting that specialized military vehicles are already made in the U.S.

The largest U.S. trade association for the auto components industry, the Motor & Equipment Manufacturers Association, said tariffs or other restrictions would mean job losses among the 871,000 auto parts industry workers and would damage U.S. competitiveness.

“MEMA remains very concerned that the pattern of recent actions from the administration signal that tariffs are one of several tactics that would be considered and imposed,” the group said. “Counterproductive unilateral actions will place manufacturers at a competitive disadvantage to their global counterparts, erode U.S. jobs and growth, and will not protect the national security of the United States.”

MEMA, whose members include plastics component suppliers, said overall employment in the auto parts industry has risen 19 percent in the last five years, and it worried import restrictions could put that at risk.

Similarly, the head of U.S. operations for Kitchener, Ontario-based injection molder Mitchell Plastics, said he feared tariffs would raise prices, lower demand and hurt the 800 workers at company factories in Michigan, Indiana and Alabama.

“I am deeply troubled by the president’s threat to levy tariffs that will affect my company and the auto industry,” said Dennis Hayes, director of USA operations, who said the company’s auto parts are “not a threat to national security.”

“I urge the administration to continue to support pro-growth initiatives, keep our auto market winning streak going and refrain from proceeding with this misguided attack on my company and industry,” Hayes wrote.

But others supported the investigation. The USW union said that South Korea, Japan and Germany target the U.S. market for exports while limiting access to their own car markets.

And it said Mexico’s government “at the behest of large corporations” has suppressed worker rights in Mexico that in effect hold down wages in the U.S. auto industry. USW urged the administration to exempt Canada from tariffs, however, saying it is a strategic partner.

President Trump, in a July 1 television interview, said tariffs would close the trade deficit in automobile production and result in more cars being made in the United States. He said his administration is eyeing a 20 percent duty, and he suggested that the auto industry is a key target of his trade strategy.

“The cars are the big one,” he said. “They’re going to build their cars in America. ... We bring in millions and millions of cars a year and we charge 2.5 percent. Some of these countries don’t even take our cars.”

According to the European Union, the EU generally has tariffs of 10 percent on U.S.-made cars, while the United States has only a 2.5 percent tariff on imported cars. The U.S. does, however, maintain a 25 percent tariff on imported light trucks.

ACC predicted that tariffs would harm the U.S. factories making plastic parts and components for the auto industry. It estimated the sector has 1,600 factories, with 61,000 employees and an economic output in 2016 of $20.8 billion.

It estimates that each car made in the U.S. and Canada has an average of $3,000 of chemical industry inputs, including plastics.

And it worried that the stakes are higher with auto tariffs. Any retaliatory measures by other countries will be much larger than what’s happening with steel and aluminum tariffs, and will close off those markets to U.S. companies, ACC said.

“Given the much higher volumes of automotive trade, retaliation by U.S. trading partners will be swift and brutal,” ACC said. “It will take years -- possibly a generation -- to reclaim the market share lost through retaliation.”

The U.S. light vehicle market was about 17.5 million units in 2016, with about 12 million vehicles made in the United States.


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