MEMA to Take Anti-Tariff Message to Trump Administration Today
MEMA will testify today before the United States Trade Representative (USTR) regarding a new round of tariffs that the Trump administration is proposing to leverage on hundreds of billions of dollars of Chinese goods. The trade action taken by the Trump administration, known as the Section 301 tariffs, imposed 25 percent tariffs on $34 billion worth of Chinese imports on July 6 as a remedy to unfair trade actions related to intellectual property (IP) theft and technology transfer. In addition, the administration has a second round of tariffs taking effect today, August 23, applying 25 percent duties on an additional list worth $16 billion. The hearings this week focus on a third round of potential tariffs between 10 and 25 percent on a list worth $200 billion.
This will be the third time that MEMA has testified before USTR on the issue, and the message has been consistent: 1) the proposed tariffs on the listed products will cause disproportionate harm to U.S. interests by disrupting American manufacturing operations and increasing costs to both U.S. producers and consumers, 2) the increased costs will create a significant harmful burden, particularly on small and medium businesses: this includes the possibility of forced bankruptcy and loss of income, and 3) the exclusion process needs to be clear and transparent. Additionally, MEMA will outline areas of agreement with the trade actions.
MEMA has repeatedly stated that tariffs to remedy intellectual property violations in China should be applied with greater precision and not as broad-based tariffs that could affect consumers and businesses. Suppliers operate in a global supply chain of domestic and international suppliers and customers. China is a large and important trading partner for our industry, with many U.S. motor vehicle suppliers maintaining manufacturing facilities in China to service Asia and the rest of the world. Domestic capacity is simply not available for some of the necessary materials and parts from China relied on by suppliers.
For more details about the 301 tariffs and other trade actions affecting the motor vehicle supplier industry, click on MEMA’s Trade Resources page. MEMA's full testimony for today's hearing is available here.