The Commerce Department is expected to deliver a long-awaited report to the White House on Sunday on whether the administration should enact tariffs on autos and auto part imports in order to protect domestic manufacturers. The business community and trade partners such as Japan and the European Union have been bracing for the report for months.
The official deadline for the department to present the report is Feb. 17, and that date remains in effect despite speculation that last month’s federal government shutdown may have pushed it back, according to people with knowledge of the deliberations. The details of the report have been kept closely under wraps, and it is not clear when the White House will make it public. An official with one stakeholder group speculated it could remain privileged for weeks.
It is generally assumed that the report will present a pretext for enacting tariffs, but business and labor groups say they have not been given a heads-up on the actual details.
The Commerce Department was originally set to release the report last summer but put it on ice after the Trump administration began talks with officials in the European Union on a potential new trade deal. Commerce Secretary Wilbur Ross said in December the report was going through “inter-agency review” and that President Trump would not impose tariffs on EU autos as long as negotiations were making good progress.
A new round of negotiations between the administration and EU officials have been accepted by both sides but not formally scheduled, and the lead-up to them has been rocky. EU Trade Commissioner Cecilia Malmstrom has repeatedly told reporters that they will not consent to putting agricultural subsidies on the table, a key issue the administration is pursuing. Trump has also pressed the EU to drop its 10 percent tariff on imported vehicles, which is much higher than the U.S. tariff of 2.5 percent.
That has amped up fears that tariffs are coming. “I think the president’s inclined to do it,” Senate Finance Committee Chairman Chuck Grassley, R-Iowa, told reporters following a meeting with the White House in mid-January.
The prospect of tariffs alarms the business community. “We’ve long said that tariffs are a tax on our customers, and would mean that Americans shopping for a new car would see the prices of many new vehicles increase,” said Wade Newton, spokesman for the The Alliance of Automobile Manufacturers, which represents domestic and foreign car manufacturers. “Imposing tariffs on imported vehicles and parts would be a mistake, with significant negative consequences for the U.S. auto industry, our employees.”
