Last week, President Trump made a major announcement regarding the United States’ steel and aluminum industries: his administration plans for a 25 percent and 10 percent tariff on imported steel and aluminum in an attempt to safeguard U.S. industries.
Thus far, the news hasn’t been welcomed by the stock market, nor the Republican party. General Motors has a more optimistic approach and more or less brushed off the impending tariffs, and Mark Reuss, GM head of product development and purchasing, spoke with CNBC last Thursday to provide his reaction to the tariffs.
Reuss reiterated the fact that GM sources 90 percent of its steel from U.S. companies, and the contracts are long-term. However, he also played on the automaker’s lightweighting strategy and spoke of the 2019 GMC Sierra specifically. With mixed-material usage, the Sierra doesn’t rely solely on one material, such as steel or aluminum. Of course, the big news is that the 2019 Sierra boasts an optional carbon-fiber bed.
He went on to say the purchasing and engineering departments are very disciplined in offsetting commodity price spikes. Should GM see price increases from steel and aluminum, Reuss said he’s not sure if the automaker would pass on the increases “dollar-for-dollar” to consumers.
“We’re here to offset any of those material cost increases or approaches, and that’s what good engineering and good manufacturing does,” he said.