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Archive for the ‘Trade’ Category

Suppliers, Dealers Express Concerns About Stability of Industry

New studies show trade uncertainty of trade policies worry groups.

by Joseph Szczesny on Mar.20, 2019

Auto dealers and suppliers are concerned about the state of the industry despite winter sales coming in as expected.

Even though sales of new vehicles have met expectations for much of the winter, a sense of unease is creeping through the auto industry, according to new surveys of suppliers and dealers.

The OESA Automotive Supplier Barometer from the Original Equipment Suppliers Association, which is a numeric measure of suppliers’ outlook on the automotive industry, continues to reflect a negative sentiment, the group reported this week.

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“There is no question that it’s going to be an interesting year. As dealers look ahead, they have a less-than-positive view of growth in the future,” said Cox Automotive Chief Economist Jonathan Smoke. (more…)

Toyota CEO “Sad” About Being Declared “National Security Threat,” But Plans $3B More in U.S. Investments

Tariffs actually could backfire and see investment plan cut back, warns top Toyota official.

by Paul A. Eisenstein on Mar.15, 2019

Toyota CEO Akio Toyoda called the prospect of his company being called a "national security threat" by the Trump administration "sad."

Toyota plans to boost by $3 billion its investment in the U.S. market, a decision that comes as the automaker – and other foreign-based brands – are facing the possibility of huge new tariffs from an American president who has labeled them a “national security threat.”

That designation is something that “makes feel sad,” Akio Toyoda, the Japanese giant’s CEO, said during an appearance at the Economic Club of Washington. “I hope that this kind of conversation can go away,” the grandson of Toyota’s founder said through an interpreter.

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Separately, the head of Toyota’s North American operations cautioned that those planned investments, which include $749 million to upgrade existing plants in five states, could be cut back if the Trump administration moves ahead with tariffs, something experts have warned could actually result in lower U.S. car sales and a sharp loss of automotive jobs. (more…)

BMW: The Leading US Exporter of New Vehicles

Automaker's SUVs extreme popularity give it the title.

by Michael Strong on Mar.08, 2019

BMW shipped more than 234,000 SUVs and coupes from the U.S.

Once again, BMW is the top exporter of vehicles from the United States. For the fifth year in a row, the German automaker’s X series sport activity vehicles took it to the top of the heap.

The company said it exported 234,689 units of its sport-utilities and coupes from its Spartanburg, South Carolina, plant during 2018, totaling more than $8.4 billion in 2018.

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“Despite…the ongoing uncertainty regarding trade and tariffs, plant Spartanburg is still positively contributing to the U.S. balance of trade,” said Knudt Flor, president and CEO of BMW Manufacturing Co LLC. (more…)

GAC Chairman Says Company Pushing US Entry Back Again

He blamed tariff uncertainty and brand name problem: Trumpchi.

by Michael Strong on Mar.08, 2019

GAC Motor President Yu Jun (center) says the company will be ready to enter the U.S. market in 2020. That entry time has been delayed again to later in the year.

Chinese automaker Guangzhou Automobile Group has once again delayed its entry into the U.S. market due to President Donald Trump’s implementation of tariffs as well as the man himself.

During the North American International Auto Show in Detroit in January, GAC officials said they were pushing back their timetable to sell vehicles in America, looking to begin now sometime in early 2020 rather than late 2019.

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However, GAC Chairman Zeng Qinghong told reporters at China’s annual parliament meeting in Beijing Friday that it would be even longer now, not establishing a time frame. He mentioned the uncertainty surrounding tariffs – discussions between the U.S. and China are ongoing – but also something personally tied to the president: his last name, sort of. (more…)

Japan Waiting on US for Signal on Trade Talks

Abe believes Trump won't raise tariffs before two sides talk.

by Joseph Szczesny on Feb.20, 2019

Trump and Abe discussed the trade imbalance between the U.S. and Japan during Trump's visit.

Japanese officials believe the Trump administration will avoid slapping higher tariffs on Japanese cars and auto parts that are imported into the United States as it faces off with China and the European Union on various trade issues.

While the majority of vehicles that Toyota, Honda and Nissan sell in the United Sates are built at factories in the U.S., they also import large number of finished vehicles as well as key components, such as engines and transmissions.

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In total, Japan’s auto industry would suffer a value-added loss of about 8 billion euros or $9 billion and Germany would lose 7 billion euros, according to a new study by the German research institute Ifo. South Korea’s auto industry would suffer a loss of more than 3 billion euros. The Ifo study looked at long-run effects, about 90% of which typically occur in five years and 99% in 10 years. (more…)

Honda Shutting Down Lone UK Auto Plant

Maker says Brexit not the reason, but move highlights problems.

by Michael Strong on Feb.19, 2019

Honda announced plans to close its manufacturing plant in Swindon. It means the loss of 3,500 jobs.

Honda will close its only auto plant in Great Britain in 2021 becoming the latest automaker to say it was leaving and turning what was once a trickle into a torrent of closures due to Brexit. The facility makes the Civic.

The Swindon plant closure means the loss of 3,500 jobs and a tenth of all vehicles produced in Britain. However, despite early reports, Honda officials claim Brexit had little to do with the move. Honda officials said the company was focusing manufacturing in the areas where it has the largest sales, and Europe isn’t one of those.

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“We had to consider the rise of electrified vehicles, and the different speeds at which electric vehicles will be taken up in North America and Europe,” said Honda Chief Executive Takahiro Hachigo. “This decision was not informed by Brexit.”  (more…)

Commerce Dept. Report Could Trigger Tariffs on Auto Imports

Auto industry worries, waits – and raises strong opposition.

by Paul A. Eisenstein on Feb.18, 2019

Commerce Secretary Wilbur Ross submitted the department's report determining if automotive imports could be declared a threat to national security.

Just hours before the deadline, the U.S. Commerce Dept. delivered a long-awaited report to the White House that could lead President Donald Trump to enact stiff new tariffs on imported autos and auto parts.

The administration has not revealed what the report recommends, but Commerce was widely expected to support the president’s position that auto imports posed a threat to national security, a view that Trump has suggested could lead to the imposition of tariffs of as much as 25%.

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Criticism was swift and broad, the Motor and Equipment Manufacturers Association noting, ““Not a single company in the domestic auto industry requested this investigation.” Like other critics, the group has warned that new tariffs could backfire and not only result in the imposition of tariffs on U.S. auto exports but also slam consumers with substantially higher prices, even on vehicles assembled in the U.S. (more…)

Commerce’s Report on Auto Imports Affecting National Security Comes Sunday

Trump expected to do little with report right away.

by Michael Strong on Feb.15, 2019

President Donald Trump will soon have to decide if using punitive tariffs makes sense in negotiations.

Just days after proclaiming a national emergency that would take $8 billion from the U.S. budget to construct additional border wall between the U.S. and Mexico, President Donald Trump will be faced with another massive decision involving foreign countries.

The U.S. Commerce Department is expected to tell Trump on Sunday whether or not foreign vehicle imports constitute a national safety risk and offer suggestions on how to deal with the situation.

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He’ll have 90 days to act on the Commerce Department’s recommendation. However, President Trump already has a plan in place for the issue: a 25% tariff on vehicles imported into the country. (more…)

Ford Warns Britain No-Deal Brexit Could Mean UK Departure

Automaker tells British PM it could pull up stakes if Brexit goes poorly.

by Joseph Szczesny on Feb.14, 2019

Ford may pull operations from the UK if the Brexit goes poorly, the company warned.

New speculation about Ford Motor Co.’s post-Brexit plans for its operations in the United Kingdom have led to reports that the automaker is preparing to exit the British Isles once the UK leaves the European Union next month.

Ford executives told British Prime Minister Theresa May during a conference call this week that the automaker, which is facing $1 billion in extra costs, may have to move some production out of Britain because of Brexit, a source on the call told the BBC.

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Ford told May it might have to use alternatives sites outside Britain, the BBC’s source – who spoke on condition of anonymity – said.  “They were just making clear that they have other options. This isn’t the only one,” the source said. (more…)

BMW Pumps Up with New X3 M and X4M Utes

Competition package delivers 503 hp.

by Paul A. Eisenstein on Feb.13, 2019

BMW will start delivering the new X3 M and X4 M to U.S. customers in April.

BMW is putting the emphasis on “sport” with two new sport-utility vehicles, the 2020 X3 M and X4 M.

The compact models get the BMW M treatment for the first time, and it starts out with a twin-turbo inline-six that, in Competition trim, will push as much as 503 horsepower to the pavement – enough to launch from 0 to 60 in just 4.1 seconds.

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Both of the new models will be assembled at the Bavarian automaker’s South Carolina assembly plant, BMW notes, something that should minimize the impact should Pres. Donald Trump authorize new tariffs on European auto imports, as he has been threatening. That said, don’t expect them to come cheap. (more…)