Trump Steel, aluminum rates that are likely to increase car costs, say industry leaders – FOX 5 Las Vegas

Detroit (AP) – President Donald Trump’s tariffs for steel imports this week can cause damage to US car production, industry leaders say. Movements are aligned with the aggressive Global Trade Program of the Trump Administration and ambitions to strengthen the US industry, but they could have the opposite effects.

On March 12, all steel imports will be taxed by a minimum of 25%, the result of two orders, which the president signed on Monday, which also includes 25% aluminum tariff. This could have a serious impact on local car companies, including Ford, GM and Stellantis – and make the vehicles of these companies more expensive for car buyers in the country.

Tariffs for important products coming outside the US put pressure on home supply of materials, experts say. The basic rules for searching and supply can increase costs.

“Steel manufacturers need to find ways to increase capacity, and aluminum and steel can be in the short term in the short term,” says Sam Fiorani, an analyzer at Autoforecast Solutions, which is studying the industry. “The production of vehicles has many moving parts and the increase in the price of what is among the most important components of the vehicle will only increase the price of an already expensive product.”

The average price of a transaction for a new vehicle in the United States in January was $ 48,641, according to the Kelley Blue Book-Resource Resource, a dumb investment for inflation-sensitive user.

“Tariffs like these do nothing to improve the automotive industry directly,” Fiorani said.

For Ford Executive Director Jim Farley, Trump’s early office action also includes 25% rates for goods coming from Mexico and Canada, although delayed by a month – already challenging the DearBorn, Michigan carmaker.

The Trump Administration has also created the policy of electric vehicles under former President Joe Biden aimed at EV charging infrastructure, as well as a targeted review of vehicle emissions and fuel rules – all this can play a role in plans for plans The automaker for decarbonisation. Car companies have already taken off some plans for electrification against the background of shifts on the market.

Most of the steel and aluminum of the three automakers already come from North America, including Ford; CEO Sheri House celebrated on Tuesday during a Wolfe research conference that 90% of the company’s steel comes from the US and that aluminum is also not as competitive.

However, Farley said on Tuesday during the same conference that “so far what we see is a lot of expenses and a lot of chaos,” according to a copy of the event.

Farley said: “The reality, however, is that our suppliers have international sources for aluminum steel. So this price will come and it can be a speculative role in the market where the price will appear, because tariffs even happen. “

Ford spokesman postponed Farley’s comments when they were reached for further comment. A spokesman for Stellantis declined to comment.

A GM spokesman postponed the comments of CEO Mary Bar from the Wolf Conference. The bar also said that a large part of the steel and aluminum used in the production of GM vehicles were obtained here and that the company did not expect a significant immediate impact.

“We are concerned about the effects down the chain on consumer products such as cars,” says Glen Stevens, Jr., CEO of Michauto, State Association of the Automobile Industry. “The anxiety when you have such a scenario, and I am not an economist, but I follow it very closely, is that the short-term benefits of higher steel prices and aluminum for domestic production are exceeded by a reduction in down the effects of the effects. “

“The automotive industry is a very competitive business,” he added. “You can’t change the supply chains very quickly and you can’t change manufacturing places very quickly.”

Trump also put rates for steel and aluminum in 2018 during his first stay in the White House. Automobile manufacturers had to review their financial plans for the year, as their perspectives fell as a result, according to Fiorani.

“Industries like Automotive have built their entire financial plan based on supply products where they can; At the local level, if possible, globally, if it has the biggest meaning, “he added.

Eric Gordon, a professor at the University of Michigan Ross, a business school, said that if automakers could not raise prices, they would lose profits.

“The compromise is that car buyers can pay more or car manufacturers can do less, in exchange for more jobs in the US steel industry and less dependence on non-steel companies.”

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Associated Press reporter Isabella Volmert contributed to this report by Lansing, Mich.

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Alexa St. John is an Associated Press Climate Solutions reporter. Follow her at X: @alexa_stjohnS Reach it at [email protected].

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