The Wall Street Journal reports that President Donald Trump is expected to soften the blow of new tariffs. Sources familiar with the matter say that automakers paying the 25 percent tariff on new cars imported to the States won’t also be charged other tariffs on materials like steel and aluminum.
“We believe the president’s leadership is helping level the playing field for companies like GM and allowing us to invest even more in the U.S. economy,” GM CEO Mary Barra said of the news, according to CNBC.
According to the plan expected to be finalized on Tuesday, automakers will be reimbursed for such tariffs already paid since the 25 percent car tariff went into effect earlier this month. They’ll also be reimbursed for imported parts up to an amount equal to 3.75 percent of the value of a U.S.-made car. This reimbursement will fall to 2.5 percent next year and be phased out in the third year. The idea is to give automakers the time they need to increase domestic manufacturing and parts sourcing.
“President Trump is building an important partnership with both the domestic automakers and our great American workers,” Commerce Secretary Howard Lutnick said. “This deal will be a major victory for the president’s trade policy by rewarding companies who are already manufacturing domestically while providing a runway to manufacturers who have expressed their commitment to investing in America and expanding domestic manufacturing.”
This does not mean the 25 percent tariff on imported cars is going away, but it prevents additional tariffs stacking on top of that. So, for new cars that GM imports to the U.S., like the Mexico-built Chevy Equinox EV or the South Korea-built Buick Envista, steel and aluminum tariffs won’t stack on top of the 25-percent car tariff.
It’s also good news for U.S.-built cars that use Canadian parts. For example, the Chevy Corvette is built at the GM Bowling Green facility in Kentucky with transmissions imported from Canada. Under this new plan, GM can apply for a reimbursement of up to 3.75 percent of the car’s value in the first year. Using the Corvette example, GM could be reimbursed up to $3,000 (3.75%) for tariffs paid to build a Corvette valued at $80,000.
Comments
I’m ok paying a tariff if the money is reimbursed to the manufacturers to put it into stateside manufacturing. I see it as investing in our own communities in our country and in our national security and as having to make the investment to reshore or friendshore much of it.
However If the company will then use that to just ship more production to places like China like Ford with the Lincoln Nautilus then they should get a penalty tariff of 200% to double every two years for mishandling of taxpayer dollars and should be treated as embezzlement of taxpayer dollars.
“I’m ok paying a tariff if the money is reimbursed to the manufacturers to put it into stateside manufacturing”.
You guys really don’t get tariffs. At all. That’s not how they work, and I’d like to see how you came up with such a convoluted thought process… what MAGA rag are you lapping this up from?
Look out folks! We have an expert in policy here. Just says “that’s not how they work” and the only backup provided is insults.
You may want to give your expert advice to the other countries that longe imposed tariffs and are now preferring to hike the existing ones they have instead of dropping them. I guess they can’t be that bad if Petty Carney is willing to make demonize Americans in favor of taxing his own people and keeping and raising tariffs.
That’s not how they work though. You don’t need a masters in economics to realize how ridiculous your take was either.
Trying to gaslight and turn around your fundamentally flawed argument on how tariffs work just further shines a light on your elementary understanding of what’s going on.
It’s not my job to teach you the basics (and yes, they are basics). Especially when it’ll go in one ear and out the other.
My last post was not intended to educate you. It was meant to ridicule a remark by someone who is clearly out of their element.
Next.
Ahh yes. Classic Projection. Which basically implies that you yourself don’t know jack $*** because you don’t add a backup argument with data or even a simple pushback. You instead add ZERO value to the conversation by spewing ridiculing and trying to make up for a confidence problem.
You understand that tariffs are taxes right? And you understand the IRS collects those taxes right? And that even though we the consumer pay those taxes, that is money intended to be INVESTED INTO OUR COUNTRY not to help with India voter turnout or gender education in Syria.
Are we finished here? Because the only thing I get out of your useless comments is how petty and tribalistic the left has become and only validate I was right in ditching the party.
Oh and keep liking your own comment. Makes you look like a real winner. 50 cent dumb@**.
I love how you guys just pull “$***” out of your “@ss” and plaster in on comments acting like it’s gospel lmao. Prove to me this is what the whitehouse is saying they’re going to do, because not even they have said anything like this. You literally have not a single shred of evidence they are going to do anything remotely close to what you’re saying.
You still haven’t listed a source as to where you came up with such an “insightful” comment and then have to cope saying I’m liking my own posts.
You guys are hilarious. Please. Keep going. I love how you’ve stewed on this for half a day and came back and posted this. I’ve got better things to do than sit here and like my own posts 20 times over and convince yourself that somehow being ratioed to hell is the only reason why you lost this argument.
Did you even read the article? They are reimbursing them. They are softening the tariffs by reimbursing them. Having said that, it doesn’t do anything about the retaliatory tariffs being charged by other countries now, they haven’t said anything about those. Mums the word. This entire situation is making us a laughing stock of the world.
It’s clearly evident this administration is backtracking on everything because it’s blowing up in their faces and the midterms look grim, even in MAGAs favorite pulse checkers, like betting markets right now over those MSM polls. They’re reversing course but the toothpaste is out of the bottle, it’s not going back in regardless now. Consumers are cooked, prices are going up, even if automarkers are getting a “partial credit”.
What about Buick building car in China?
Oh sure. That’s the line for today, but tomorrow he’ll double them. Maybe not. Since his approval percentages are hitting 80-year lows, guess he’s feeling unloved. But he’ll still tell you he’s the best ever.
Like the dems are any better, their approval rating is even lower than trump.
I’m willing to bet that the reason the Dems also have a low rating is because the public along with their low education think that the Dems have any power to stop this guy. Plus, any decent Rep are gone too, and all the current Rep are there to just be a rubber stamp for the dictator.
Trump is a loser
The art of the deal!
as he promused, has in 100 days the country you live g r e a t .. mean huge economically dream again ? it is clear most US population is rich… other day saw a documentary the one who survives under sidewalks in las vegas… how is g r e a t for them? maybe gor you reader who change cars twice or more times a year, yep… it is…
I can’t believe the amount of people that don’t understand the way Tariffs work for the Auto Industry. The buyers will pay the Tariffs. Maybe short term a manufacturer will try to absorb some of it. But, history shows the industry will bring manufacturing back in a automation capacity. There will be net loss of jobs. Companies are in business to make money. So, we’ll loose say a 100%, through this Tariff B.S. Will get 1/2 back This Administration will say we won and some uninformed folks will agree. We’re losing money we’re never going to get back. It’s like looking for a the right Job for a 10% increase and it takes a year to get. It’ll take 11 years to get to that 10% raise.
1) Automated factories aren’t like one guy comes in at 7 AM pushes a button and the whole place just comes to life churning things out. You still have operators of those machines and people that have to perform quality control on the product because a human set of eyes is still needed to overlook the machines work. Also, the guy maintaining and programing the machines will need to be highly specialized so right there its a well paying job. All those roles will need to be filled by locals. Also, by producing the products locally you are able to save on shipping costs and use more local railroads to transport those goods in the country. Because one thing is for sure, shipping costs will keep going up as fueling those ships will only get more and more expensive.
2) Even if all the jobs are automated, the goal of the tariff is to bring back the manufacturing regardless and prevent an adversary from entirely controlling an essential supply of important products. When the great manufacturer from the east chokes off supplies as a means of coercion, its time to start thinking about safeguarding your supply chains. So you either start thinking about long term security or Darwin will pay you a visit. Plain and simple.
3) As for the net loss of jobs, oh dear. Less factory workers working at $7 a day in Guangzhou. How awful…maybe they should strive for a government that can actually be trusted and not play games with the global supply chain by using coercion as they please. Don’t think we Americans forgot about how they were toying with the idea of choking off supplies of antibiotics to the US in the middle of a pandemic THEY caused.
You are projecting too much in the more distant future. Americans living from one paycheck to another or relying on social security and Medicare are worried about the present and near future. Others (me included) are worried about their lifetime savings (401k) taking a steep dive. Luckily I am still working, I can re set my investments strategy and recover the losses.
And do not underestimate China. They are moving at a different speed and they are used to tightening the belt if their leader tells them to do so.
So a bit of current reality check is necessary before we start dreaming about all the made promises.
I’ve worked in an industry that looked always, almost quarterly on product cost. Production was moved due to hourly rates in the US. I watched the company take a production line from 60 people and Automated it to 27 people. Quality increased and production cost decreased. The Government will give a tax break on property, machinery and investment. Now as a tax payer like all of You folks, we paid for this. We need to support our American companies…
You make some excellant points. as a grunt in a auto parts factory ( a major company) for 26 years. I saw our department back in around 2005 go from old machinery to comput-
erized machines. We went from about 110 jobs to to about 65. We had to learn new skills. Just as you say for quality control and fix our own jam ups. Knowledge intensive but now very interesting. More quality + increased production. More money contract time. GOODY GOODY GOODY> NOT GREEDY>
Show folks when they buy something whats the cost of the Tariffs. It will definitely show who’s paying it and what… We should demand it. We all need to know, Why hide….
Disclosing the cost of tariffs on the purchasing price is the last thing the current administration would want to do. Jeff Bezos was attacked by the POTUS hours after rumors of such disclosure appeared in the mass media. Probably nobody else will have the balls to try and publish such information after that. And to me it sounds like a legitimate request from the paying consumers.
Trump blinks again ! And it won’t be the last time.
Here’s a Novel idea. Stop buying products from foreign companies…
Buy from American companies. Take power into your own hands and support your Neighbor, Family and Friends…
It’s not just the government of these countries like Japan, Germany and Korea. It’s the people. They don’t want to buy our stuff and we on the other hand don’t really care. Some of us don’t care about our country like others countries… That’s a fact….
Flip Flop Trump…… that guy is a joke
Tariffs are simply penalties. Trump is using them under the guise of bringing (forcing) manufacturing to the USA. His actual goal is and has always been to use those funds to knock down the current deficit. Nothing more. Coerce the world to pay for our inability to control our own finances.
You and I will pay for it, straight out of pocket. Every penny. For automobiles it will add approx. 10% to all vehicles affected. Vehicles are already way too expensive. Moving manufacturing is an expensive undertaking and takes way more time than most folks think. Get rid of all Tariffs and negotiate an acceptable deal for both parties and move on.
That’s what Trump said he did with the USMCA. Ask him. “Greatest deal ever.” Of course everything he does, is. It’s truly not a complicated issue. If we don’t want German made vehicles here, don’t import them or better yet, don’t buy them. That will truly solve the problem.
Tariffs were never going to be used to reduce the deficit, the plan from the beginning was to use the revenue collected from tariffs to fund the 2017 tax cut permanently, well that and cutting 880 billion from medicaid.
When the deficit continues to climb they’ll then go after Social Security and Medicare. I just don’t understand why no one in MAGA land has learned that 90% of everything that comes out of Trump’s mouth is a lie.
OLD SCHOOL saying explains this ( from back in PRE-HISTORIC times)
You lead a horse ( in this case a MULE + DONKEY ???) to water BUTT you can*t
make them Drink”. You betcha for sure. Some people will drink da KOOL-AID and LOVING IT>
trump keeps saying to americans . What can I do you for today ??? People don*t GET It.
BUTT they do get it in the END. Get It.