Six of the leading policy organizations that speak for the U.S. auto industry are unusually coming together to lobby the Trump government to oppose 25% tariffs on auto parts scheduled to go into force by May 3. The coalition – speaking for franchised automakers, suppliers and almost all significant automakers – write in a note to Trump government officials that the impending tariffs threaten U.S. automotive manufacturing. The note mentions numerous auto suppliers already have financial difficulties and might not meet the additional expense enlargements, causing more widespread industry issues.
“The majority of automobile suppliers are not financed for a sudden tariff caused uproar. A lot of them are already struggling and will have production shutdowns, job losses, and bankruptcy,”
states the letter.
“It takes only the collapse of one supplier to cause the suspension of an automaker’s production line. Whenever it occurs, as happened during the pandemic, all the suppliers are affected, and the employees will be out of their careers.”
The statement, signed on April 21, is directed at U.S. Treasury Secretary Scott Bessent, U.S. Department of Commerce Secretary Howard Lutnick and U.S. Trade Representative Ambassador Jamieson Greer.
It is inked by leaders of American International Automobile Dealers Association, National Automobile Dealers Association, Autos Drive America, Alliance for Automotive Innovation, vehicle suppliers’ association MEMA, and American Automotive Policy Council heads.
The joint letter is unusual, if not historic, for the auto business. Such companies seldom, if ever, endorse a collective position.
The associations claim to speak for the nation’s No. 1 manufacturing industry with 10 million American employment opportunities in all 50 states and $1.2 trillion injected into the economy annually. Other automakers that are not covered by the groups are electric car manufacturers Rivian Automotive, Tesla, and Lucid Group.
“US President Donald Trump has signaled a willingness to reconsider the policy of imposing 25 percent tariffs on imported auto parts – the same tariff relief that was recently granted to products such as electronics and semiconductors. A positive development like that would be a welcome relief,” the letter states.
The letter follows on the heels of Trump’s statement last week that he might allow certain auto manufacturers that require extra time to relocate or boost U.S. car manufacturing.
“I’m searching for solutions to assist certain car manufacturers that are transitioning to parts manufactured in Canada, Mexico, and elsewhere. They require some time to begin producing them locally,” Trump stated on April 14. “However, they do need some time, so I’m discussing topics like that.”
Auto executives and analysts have said president’s tariffs are more catastrophic for auto parts makers than for the automakers as a whole. The effect might produce a swell impact across the international supply chain, they add.
Automotive officials project a decrease in vehicle sales by millions of units, rising prices for both new and used vehicles, and costs surpassing $100 billion throughout the industry, as indicated by research statements from Wall Street and automotive reviewers.
“We promote increased manufacturing and additional supply chains within the United States, but it is unfeasible to shift global supply chains overnight or even within months. This process will require time,”
states the letter.
