NEW YORK: US President Donald Trump’s threat to tax imported cars, in the name of national security, risks weakening domestic manufacturers, but could accelerate renegotiation of the North American Free Trade Agreement. At the end of the Group of Seven summit, Trump renewed his threat to impose tariffs on cars imported into the United States by manufacturers accused of unfairly taking market share from American carmakers. But this decision may be counterproductive because not only do most of the targeted manufacturers have factories in the US, but American carmakers are among the largest importers of vehicles from Canada and Mexico. The move would also come at a time when China – the world’s largest car market – is moving in the opposite direction, lowering taxes on imported vehicles from 25% to 15%.
Published in The Express Tribune, June 12th, 2018.