U.S. tariffs on imported vehicles and auto parts could force General Motors to cut jobs, the automaker said in a blunt statement that surprised industry observers.
General Motors issued a stern warning to the Trump administration that it could shrink U.S. operations and cut jobs if tariffs are broadly applied to imported vehicles and auto parts.
“Increased import tariffs could lead to a smaller GM, a reduced presence at home and risk less — not more — U.S. jobs,” the nation’s largest automaker said in comments submitted Friday to the Commerce Department.
That such a blunt statement came from GM — a company run by a CEO, Mary Barra, whose normal tack is to avoid the political fray and let trade groups address the president’s policies — was surprising to industry observers. And it underscored how high she, and many industrial leaders, believe the stakes are as the president sinks the U.S. into tit-for-tat trade squabbles across the globe. GM’s public pronouncement follows similar moves by Harley-Davidson, Toyota and Daimler.
The “comment suggests how severe the impact would be to GM, its employees and consumers,” said Michelle Krebs, analyst with AutoTrader.com. “There is a lot at stake for GM, the auto industry and the overall economy.”
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President Donald Trump last month ordered an investigation of whether auto imports pose national security risks under a section of the same 1960s trade law used to impose levies on steel and aluminum. The administration is said to be considering auto tariffs of as much as 25 percent.
Trump told reporters aboard Air Force One on Friday afternoon that he expected the Commerce Department to complete the investigation “in three or four weeks.”
Under the trade statute, Commerce Secretary Wilbur Ross has until February to conclude the inquiry. But people familiar with the matter said Trump wants the investigation to be finished before the midterm elections in November so he can use the tariffs to his political advantage.
The probe has raised alarm among manufacturers, parts suppliers and auto retailers because all major carmakers — including GM and Ford — import a substantial share of the vehicles they sell in the U.S. from other countries. Levies on parts also would have major implications for top models like the Ford F-150 pickup and Toyota Camry sedan by boosting prices by thousands of dollars.
GM stock fell 2.8 percent Friday and has now posted three straight weekly declines, the longest such streak since March.
The White House didn’t immediately comment on GM’s remarks.
GM’s message came as a surprise because the company has kept close contact with the Trump administration, James Albertine, analyst with Consumer’s Edge Research told Bloomberg TV.
Barra had earlier tried to stay on good terms with Trump. She continued to serve on his Strategic and Policy Forum even after many other CEOs quit to protest Trump’s withdrawal from the Paris climate agreement last year. The forum was disbanded in August.
Another motorcycle maker considers overseas output
SPIRIT LAKE, Iowa — A Minnesota-based company said Friday that it is considering moving production of some motorcycles out of the country because of European tariffs, just days after Harley-Davidson announced a similar move
A spokeswoman for Polaris Industries acknowledged that the company could move some production of its Indian Motorcycles from northwest Iowa to Poland.
“Nothing is definitive,” Polaris spokeswoman Jess Rogers said. “We’re looking at a range of mitigation plans.”