MEMA Supports Bipartisan Effort to Stop Threat of Tariffs on Autos and Motor Vehicle Parts

Date: May 14, 2019

MEMA applauds a bipartisan letter signed by 159 members of Congress requesting that White House officials advise the Trump administration against imposing tariffs on autos and motor vehicle parts on the basis of national security.

The letter, which was signed by 79 Democrats and 89 Republicans, was addressed to Director of National Economic Council Larry Kudlow and was sponsored by Reps. Terri Sewell (D-AL), Jackie Walorski (R-IN), Ron Kind (D-WI), and  Drew Ferguson (R-GA).

“American auto workers, parts suppliers and retailers, dealers, vehicle service providers, and millions of consumer depend on a healthy and competitive U.S. auto industry. As you know, this vital sector employs nearly four percent of our total private sector workforce and is a key engine that powers our economy. However, if tariffs were to be implemented, new vehicle prices will likely increase, threatening hundreds of thousands of jobs,” the letter reads. “We are also concerned that vehicles outside of the intended scope of the investigation will be subject to tariffs. Parts used in passenger vehicles may overlap with motorcycles, recreational vehicles, construction equipment, heavy-duty trucks, farming equipment, powersports vehicles, and others. Additionally, inevitable retaliatory tariffs from countries around the world, including our close allies, will cause further harm to American farmers, manufacturers, and consumers.”

MEMA, in its many interactions with the Trump administration, has expressed these same concerns in the wake of the Department of Commerce’s Section 232 national security investigation of imports of automobile and automotive parts. The report, which was completed in February and to date not made public, is now in President Trump’s hands. He could impose tariffs on auto parts as high as 25 percent. MEMA has argued that these broad, unilateral, and import-restrictive measures, if imposed, could jeopardize the 871,000 vehicle supplier jobs in the U.S., harm the global competitiveness of the U.S., and diminish investment in the U.S.

“American auto manufacturers, parts suppliers and retailers, dealers, and vehicle service providers have not asked for and do not need protection. Tariffs on autos will raise prices for American consumers and lower demand, ultimately leading to decreased U.S. production, investment and employment,” the letter concludes. “We urge you to do everything you can to avoid trade restrictions that would negatively impact the U.S. auto sector and undermine our economic security.”

 

MEMA and AASA Oppose Illinois Bill that Would Discourage Use of Aftermarket Parts

MEMA and the Automotive Aftermarket Suppliers Association (AASA), MEMA's light vehicle aftermarket division, have formally opposed a proposed Illinois law that would limit the use of quality aftermarket parts by requiring written consent for the use of non-original equipment aftermarket crash parts.

The bill, S.B. 2104, would be harmful to the automotive aftermarket manufacturing industry, would reduce consumer choice, and put jobs at risk, MEMA wrote in a May 8 letter to Illinois General Assembly House Labor and Commerce Committee Chairman Marcus C. Evans, Jr.

“The language in S.B. 2104 discourages the use of aftermarket replacement parts for motor vehicles. If this bill passes, consumers will be faced with higher repair costs and fewer repair choices, and manufacturing jobs would suffer due to less demand for aftermarket products,” the letter says. “By requiring written consent for the use of non-original equipment aftermarket crash parts, this legislation discourages the use of quality aftermarket parts. This is not only harmful to the industry and consumers but ignores the value and benefit of aftermarket motor vehicle components. Additionally, this legislation in its current form would create confusion for automobile owners, as the bill does not clearly define OEM repair procedures.”

The U.S. automotive light vehicle aftermarket is a $305 billion industry that includes manufacturing, remanufacturing, distribution, retailing, and installation of all vehicle parts, chemicals, tools, equipment, and accessories. Most automotive aftermarket maintenance and repair work takes place in independent repair shops or at vehicle manufacturers’ dealerships. Independent repair shops comprise approximately 70 percent of the service bay capacity and provide a convenient and affordable solution for vehicle service. 

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