WASHINGTON—The U.S. government's latest proposed 25 percent tariffs on imports from China, coupled with earlier tariff rounds, risk causing serious economic harm to the auto supply chain, an auto industry trade association told a government hearing June 21.
Ann Wilson, senior vice president of government affairs with the Motor & Equipment Manufacturers Association, told the U.S. Trade Representative's hearing that tariffs are particularly harmful to lower-tier components makers.
She added that companies are delaying investment, and she warned of bankruptcies.
"We have been contacted by what we call Tier 2 and Tier 3 suppliers, often the major employers in small communities across the country, with concerns about the large scale 25 percent tariffs moving profitable companies into the red and precipitating bankruptcies and posing other threats," Wilson said.
She told a panel of government officials at the fact-finding hearing that companies are worried about the "compound effect" of the latest round of tariffs—25 percent on $300 billion in Chinese imports—along with the steel and aluminum tariffs, earlier China tariffs, uncertainty over whether the new U.S.-Mexico-Canada Agreement will pass and the "real potential" for more tariffs on imported cars and parts.
"I know I've talked to you many, many times—and you're probably sick of seeing me and other people like me (talking) about this—but I cannot reiterate enough: We have 1,000 member companies, I talk to CEOs all the time (and) these kinds of tariffs are going to affect the cost to consumers," she said. "It's going to effect and it is affecting jobs right now. Our companies are not filling open jobs."
"Make no mistake about it, these proposed tariffs are a tax on the American public," Wilson said.