Published: Thu, July 05, 2018
Business | By Eloise Houston

Auto Tariffs Threaten to Ignite Authentic Economic 'Trade War'

Auto Tariffs Threaten to Ignite Authentic Economic 'Trade War'

The new campaign, detailed first to Reuters, is an aggressive effort by the business lobbying giant.

"The penalties we could incur from tariffs and increased costs will be detrimental to the future industrial strength and readiness of manufacturing operations in the United States, and could lead to negative consequences for our company and USA economic security".

"The administration is threatening to undermine the economic progress it worked so hard to achieve", continued Donohue.

In its submission, the European Union argues that trade restrictions would be likely to lead to higher costs for US-based producers, and in effect become a tax on American consumers.

Europe is "possibly as bad as China" on trade, US President Donald Trump said in an interview broadcast Sunday, with trade wars emerging against both the Asian giant as well as longtime allies in Europe and Canada.

Although Trump has previously been persuaded to back off trade threats based on the fact that they would hurt states that supported him in the 2016 presidential election, he has taken a more aggressive tack in recent months.

The number of exports that could be hit by retaliatory tariffs among the 10 most vulnerable states ranges from $1.7 billion in Pennsylvania to $6.2 billion in Washington.

Against China, the world s second-largest economy, the White House in mid-June announced stiff 25 percent tariffs on Chinese imports, sparking immediate retaliation from Beijing.

According to Foreign Minister Chrystia Freeland, Canada is working closely with the European Union and Mexico to take on the US economic machine.

The EU has targeted $3.2 billion U.S. in American goods exported to the 28-member bloc, including bourbon and Harley Davidson motorcycles. The EU, which described the move as "pure protectionism", introduced duties on USA products in return, as did Mexico, Canada, Turkey and India.

And he is pressuring Canada and Mexico to agree to rewrite the North American Free Trade Agreement to shift more auto production to the United States and encourage companies to move investment from Mexico to the United States. And China will promptly strike back with tariffs on an equal amount of US exports.

Several European auto makers already build their vehicles in the U.S., with the most recent example being the BMW X7, which will be exempt from tariff changes.

Michigan: In total, $2.3 billion of state exports will be subject to retaliatory tariffs.

The White House has already imposed tariffs on European Union steel and aluminium and faced reprisals in the form of extra charges on a range of goods, including US-made motorcycles, jeans and even playing cards.

Trump went on to say "we also love the European Union" and point out that his parents were born within the area now encompassed by the European Union, before those countries were a part of the European Union.

Trump has attacked the legendary Harley-Davidson motorcycle company, warning "we won't forget" after the firm said it planned to shift some manufacturing offshore due to European Union tariffs.

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