Trump administration mulling tariffs on auto imports

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President Donald Trump is considering an investigation that could end in tariffs on imported cars.

It was not clear, however, whether Trump's tweet was referring to a possible breakthrough in the talks.

"There will be big news coming soon for our great American Autoworkers", Mr. Trump said. Trump said in the tweet.

The United States imported 8.3 million vehicles in 2017 worth $192 billion, including 2.4 million from Mexico, 1.8 million from Canada, 1.7 million from Japan, 930,000 from South Korea and 500,000 from Germany, according to USA government statistics. He has also criticized European Union auto imports and tariffs and earlier this year threatened a "tax" on European imports.

The threat of tariffs could also be a useful bargaining chip, as the US tries to negotiate new trade agreements with Japan, Mexico, Canada, and the European Union. The provision authorizes the president to restrict imports and impose unlimited tariffs on national security grounds.

The president previously used Section 232 to impose tariffs on steel and aluminum.

At a meeting with automakers at the White House on May 11, Trump told automakers he was planning to impose tariffs of 20 or 25 per cent on some imported vehicles, sources have told Reuters, specifically criticising German automakers for importing a large number of vehicles into the US. Both times - in a 1999 case involving oil imports and a 2001 case involving iron ore and steel imports - the Commerce Department refused to recommend sanctions.

Trade experts have warned that the use of Section 232 opensthe door to possible retaliation from other countries and violates global trade rules.

Early on, the three sides had difficulty talking about the auto industry's place in the deal because Trump wanted to change the rules of origin to favor the U.S. Canada and Mexico balked at his initial proposals on the percentage of content. I am not happy with their request.

Trump - whose protectionist platform helped launch him to the White House - has repeatedly floated the notion of steep tariffs that would shield the United States auto industry. He said America's neighbors have been "very spoiled because nobody's done this but I will tell you that what they ask for is not fair".

The U.S. temporarily exempted Canada and Mexico from those tariffs pending the outcome of NAFTA talks. The U.S. has also sought to change NAFTA's dispute-resolution system, and include a sunset clause that would allow countries to exit after five years.

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