Trump suggests he’s looking into tariffs on car imports

[TU Curmudgeon]

From the Associated Press

Trump suggests he’s looking into tariffs on car imports
​

WASHINGTON (AP) — President Donald Trump hinted Wednesday that he’s looking into slapping tariffs on car imports, a day after he threatened to slash federal subsidies to General Motors for wanting to close five U.S. factories.

GM announced Monday that it wants to shutter the plants and slash 14,000 jobs in North America. Many of the job cuts would affect the Midwest, the politically crucial region where the president promised a manufacturing rebirth.

Trump’s comments about GM’s plan are the latest example of his willingness to try to meddle in the affairs of private companies and threaten to use government power to influence their business decisions.

Trump boasted on Twitter Wednesday that Steel Dynamics, based in Fort Wayne, Indiana, was opening a new plant in the Southwest, creating 600 jobs. He said it was evidence that steel jobs were returning to America because of tariffs he imposed on steel imports.

COMMENT:-

It appears that Mr. Trump sort of overlooked the fact that the Steel Dynamics plant isn't expected to begin construction until 2020 and isn't expected to begin operations until 2021. (Those 600 "new jobs" will take around 75 years to make up for the 45,000 worker-years of jobs lost because of the GM plant closings.)

On the other hand, I don't expect to see Mr. Trump imposing new tariffs on car imports until after the Canada, Mexico, and the US have ratified NAFTA 2.0 (which Mr. Trump will have to ignore because it restricts tariffs on new car imports).

Well, maybe Mr. Trump will put the new tariffs on the day before the NAFTA 2.0 is ratified and then take them off as soon as NAFTA 2.0 is ratified.

PS - I do expect that everyone knows that a "formal signing" of NAFTA 2.0 (which is slated to take place at the G20 meeting) has absolutely nothing whatsoever to do with "ratification" - it does, however, have one hell of a lot to do with providing a political photo-op.

PPS - A really devious person would be wondering at what would happen if, when the leaders of Canada, Mexico, and the US have gathered in front of the media for the "formal signing", the Canadian and Mexican leaders announced that "because of the expressed intention of the President of the United States of America to violate the terms of the agreement that Canada and Mexico had - in good faith - negotiated with the United States of America, to carry out a formal signing of an agreement which the United States of America has no intention of honouring, we are not going to sign." and walked out.

PPPS - Regardless of any "free trade agreement" countries still retain the right to impose tariffs and duties to offset any subsidy which the government of another country pays to its industries. Mr. Trump has now officially announced that the US government subsidized General Motors. (Well, either that, or he has given evidence that he simply doesn't know what he is talking about.)
​

 

[OrphanSlug]

Republican use of the term 'evidence' never ceases to amaze me.

 

[TU Curmudgeon]

Republican use of the term 'evidence' never ceases to amaze me.

EVIDENCE -

• a thing that someone told me that someone else reported that they had heard and which supports what I want the truth to be;
• (obs) verified and factual items or data with regard to any point regardless of whether those support the hearer's position.
• (ant) - "Fake News" - verified and factual items or data which do not support the hearer's position or desired reality.

Source - "The Updated New Revised Original True Dictionary of Political Terms and Expressions".

 

[Mycroft]

From the Associated Press

Trump suggests he’s looking into tariffs on car imports
​

WASHINGTON (AP) — President Donald Trump hinted Wednesday that he’s looking into slapping tariffs on car imports, a day after he threatened to slash federal subsidies to General Motors for wanting to close five U.S. factories.

GM announced Monday that it wants to shutter the plants and slash 14,000 jobs in North America. Many of the job cuts would affect the Midwest, the politically crucial region where the president promised a manufacturing rebirth.

Trump’s comments about GM’s plan are the latest example of his willingness to try to meddle in the affairs of private companies and threaten to use government power to influence their business decisions.

Trump boasted on Twitter Wednesday that Steel Dynamics, based in Fort Wayne, Indiana, was opening a new plant in the Southwest, creating 600 jobs. He said it was evidence that steel jobs were returning to America because of tariffs he imposed on steel imports.

COMMENT:-

It appears that Mr. Trump sort of overlooked the fact that the Steel Dynamics plant isn't expected to begin construction until 2020 and isn't expected to begin operations until 2021. (Those 600 "new jobs" will take around 75 years to make up for the 45,000 worker-years of jobs lost because of the GM plant closings.)

On the other hand, I don't expect to see Mr. Trump imposing new tariffs on car imports until after the Canada, Mexico, and the US have ratified NAFTA 2.0 (which Mr. Trump will have to ignore because it restricts tariffs on new car imports).

Well, maybe Mr. Trump will put the new tariffs on the day before the NAFTA 2.0 is ratified and then take them off as soon as NAFTA 2.0 is ratified.

PS - I do expect that everyone knows that a "formal signing" of NAFTA 2.0 (which is slated to take place at the G20 meeting) has absolutely nothing whatsoever to do with "ratification" - it does, however, have one hell of a lot to do with providing a political photo-op.

PPS - A really devious person would be wondering at what would happen if, when the leaders of Canada, Mexico, and the US have gathered in front of the media for the "formal signing", the Canadian and Mexican leaders announced that "because of the expressed intention of the President of the United States of America to violate the terms of the agreement that Canada and Mexico had - in good faith - negotiated with the United States of America, to carry out a formal signing of an agreement which the United States of America has no intention of honouring, we are not going to sign." and walked out.

PPPS - Regardless of any "free trade agreement" countries still retain the right to impose tariffs and duties to offset any subsidy which the government of another country pays to its industries. Mr. Trump has now officially announced that the US government subsidized General Motors. (Well, either that, or he has given evidence that he simply doesn't know what he is talking about.)
​

Perhaps you should wait and see exactly WHO Trump ends up slapping the auto tariff on...instead of assuming it'll be on Mexico or Canada.

I think it's more likely he is using this statement as a warning...leverage, if you will...on the likes of China and the EU. We'll know a bit more, perhaps, after his meeting with Xi this weekend and his meeting with the EU automakers next weel.

 

[Mach]

I think it's more likely he is using this statement as a warning...leverage, if you will...on the likes of China and the EU.

Nothing but rumors. Dismissed!

(How's my Mycroft post impression?)

 

[Lord Tammerlain]

Perhaps you should wait and see exactly WHO Trump ends up slapping the auto tariff on...instead of assuming it'll be on Mexico or Canada.

I think it's more likely he is using this statement as a warning...leverage, if you will...on the likes of China and the EU. We'll know a bit more, perhaps, after his meeting with Xi this weekend and his meeting with the EU automakers next weel.

FYI

US imports of cars from China are very small. The largest volume being the Buick Envision with around 40 000 units, there are about 4 other vehicles being imported from China but the volumes are low. The US actually exported 260 000 vehicles to China in 2017.

 

[Mycroft]

Nothing but rumors. Dismissed!

(How's my Mycroft post impression?)

Not good.

You see, I didn't state anything as fact that is actually rumor. I only gave my opinion. (that's what "I think" means, in case you didn't know)

 

[Mycroft]

FYI

US imports of cars from China are very small. The largest volume being the Buick Envision with around 40 000 units, there are about 4 other vehicles being imported from China but the volumes are low. The US actually exported 260 000 vehicles to China in 2017.

A tariff on autos built in China could induce GM to move its production back to the US. Good for American workers. Bad for China.

 

[Lord Tammerlain]

A tariff on autos built in China could induce GM to move its production back to the US. Good for American workers. Bad for China.

GM only sells two Chinese built cars in the US, the Buick Envision and the Caddy CT6 plug in hybrid. Both of those two cars sell in greater numbers in China than the US, the Envision designed specifically for the Chinese market. GM however sells more cars in China than it does the US. More tariffs on Chinese products could see the Chinese public turn away from GM products, leading to a drastic decline in GM sales in China, causing GM to take a big hit in profits (while giving a boost to Japanese and European makers)


So no boost to America, or to American workers, as GM sales in China, help keep it paying for its workers in the US. Fewer sales, fewer white collar workers in the US designing, engineering the vehicles, fewer accountants, fewer lawyers.


A note regarding GM

GM is retrenching from being a global automaker involved in all major markets (Japan excepted as sales there are very small) to being a market factor in just three markets (two of any meaning). GM right now makes the majority of its sales in North America and in China (more sales in China, but more revenue in North America. Should GM lose the Chinese market, it will become a secondary international automaker, likely over time be regulated to building pickup trucks, or be bought out by a foreign automaker who wants in on the profitable light truck market. With the new owner likely to close everything but that operation. GM right now needs to be strong in the Chinese auto market or it will fall to the level of Peugeot when it comes to the auto industry


Of course that is assuming electrification, self driving cars and ride sharing does not decimate the entire world wide auto industry.

 

[Mach]

Not good.
You see, I didn't state anything as fact that is actually rumor. I only gave my opinion. (that's what "I think" means, in case you didn't know)

What were all the significant things he stated as fact, that aren't, that you objected to? Be clear, and quote him.

 

[TU Curmudgeon]

Perhaps you should wait and see exactly WHO Trump ends up slapping the auto tariff on...instead of assuming it'll be on Mexico or Canada.

I think it's more likely he is using this statement as a warning...leverage, if you will...on the likes of China and the EU. We'll know a bit more, perhaps, after his meeting with Xi this weekend and his meeting with the EU automakers next weel.

Using his usual targeting technique, Mr. Trump is likely to slap the tariffs on everyone in sight and worry about the results later.

 

[TU Curmudgeon]

FYI

US imports of cars from China are very small. The largest volume being the Buick Envision with around 40 000 units, there are about 4 other vehicles being imported from China but the volumes are low. The US actually exported 260 000 vehicles to China in 2017.

And, according to the auto industry, that number is looking to decline precipitously due to the Chinese imposing tariffs on American cars that match (per unit) the tariffs that Mr. Trump has imposed on Chinese cars.

 

[TU Curmudgeon]

A tariff on autos built in China could induce GM to move its production back to the US. Good for American workers. Bad for China.

Did you know that GM exports more cars to China than it imports to China?

If the number of units produced doesn't change, do you know what a 75+% drop in unit sales results in as far as "job creation" is concerned?

 

[Mycroft]

Using his usual targeting technique, Mr. Trump is likely to slap the tariffs on everyone in sight and worry about the results later.

On the contrary. Trump has been very targeted in his application of tariffs.

https://www.cnn.com/videos/politics/2018/07/29/larry-kudlow-tariffs-sotu-sot-vpx.cnn

 

[Grand Mal]

A tariff on autos built in China could induce GM to move its production back to the US. Good for American workers. Bad for China.

Really. You think that might happen? And what might be the result of a Chinese tariff on American cars? Bearing in mind that cars going to China outnumber those coming to the US by what, a factor of ten? And bearing in mind that the Chinese market for consumer goods is only going to increase as the Chinese economy gets bigger while the US market is pretty much saturated.
Looks to me like a tariff war will have the result of GM moving more production to China to avoid the tariff on hundreds of thousands of vehicles. Once again Trump's policy will make American produced goods more expensive.

 

[TU Curmudgeon]

On the contrary. Trump has been very targeted in his application of tariffs.

https://www.cnn.com/videos/politics/2018/07/29/larry-kudlow-tariffs-sotu-sot-vpx.cnn

You know, you are right and that's why the US trade balance with China has shifted so much in America's favour since Mr. Trump started imposing tariffs.

PS - Did you know that using the "testimony" of a "backer" is probably not the best way of providing impartial evidence to back up a claim? BTW, even if it were, a commentary somewhat more current than almost six months ago would probably be a better idea.

PPS - Wouldn't it have been simpler to link to Mr. Trump saying "My tariffs are the best tariffs ever and have completely reversed America's trade deficit with China." (or something like that) in order to prove that Mr. Trump's tariffs are working the way that Mr. Trump said that they were going to work.

PPPS - Yes, I know that "US, China reach 90-day ceasefire in their trade dispute". However, if you actually read what transpired, Mr. Trump agreed not to impose any new tariffs on China for 90 days, and the Chinese agreed not to impose any new tariffs on the US for 90 days. The Chinese did NOT agree to remove a single tariff on any items - including items that the US really wants to see the tariffs removed from - and the US didn't promise to remove any tariffs - including on items that the Chinese simply don't care about having an American source of consumers for (read as "everything that Mr. Trump has put tariffs on").

 

[TU Curmudgeon]

A tariff on autos built in China could induce GM to move its production back to the US. Good for American workers. Bad for China.

Indeed it might.

Of course a tariff on autos built in America could induce GM to move its production to China.

The equation is

"existing jobs"
+ "jobs to make 40,000 units"
_ - "jobs to make 240,000 units" _

"a net __[gain/loss (pick one only)]__ in jobs"​

What do you think the answer is?

Good for Chinese workers?

Bad for America?