Trump’s New Trade Decision: Impose Tariffs on Imported Cars?

First Up 02/15/19

Feb. 15, 2019

Branding Dilemma Ahead for Carmakers and Other Auto Tech Predictions

The auto industry is heading toward a perplexing branding issue regarding future infotainment systems, according to a list of predictions released this week by navigation software company NNG LLC. Google entered into a partnership with the Renault-Nissan-Mitsubishi alliance last year to install its Android operating system in the next-generation infotainment systems in millions of cars built by the organization’s three automakers. Forbes reports that it’s all part of an expensive and risky evolution of the industry as traditional automakers such as General Motors Corp. look to morph into what CEO Mary Barry has described as mobility and technology companies. NNG Chief Technical Officer Tamas Kerecson points out automakers who attempt to stray too far from their core manufacturing and marketing activities by bringing specialized technology development in-house often turn tail before long.  “Once they make a little jump or they understand the problems they hand it back to the suppliers. None of the car makers really want to have a gigantic staff.” For more on this growing issue, click here.

Trump’s New Trade Decision: Impose Tariffs on Imported Cars?

Sometimes, on a bad night, Brad Strong wakes at 2 a.m. and can’t get back to sleep. The insomnia isn’t about his family or money or health. It’s about tariffs. The Strong family’s three car dealerships in Salt Lake City could suffer a significant blow if President Donald Trump proceeds with a proposal to impose tariffs of 20 to 25 percent on imported autos and auto parts. According to the Associated Press, Strong may be in for a few more sleepless nights. By Sunday, Trump’s Commerce Department is expected to issue an opinion on whether auto imports endanger U.S. national security enough to justify such import taxes. Trump would then have 90 days to decide whether to impose them. If it does suggest that Trump impose the tariffs, Commerce would be advocating a major escalation in Trump’s combative trade policies.  “I think it would be harmful to the whole economy,” said Howard Hakes, president of Hitchcock Automotive, which has three Toyota showrooms in metro Los Angeles. “You put a 25 percent tariff on that, you’re slowing down the train that’s rolling already.” For more on tariffs, and how much they could increase the price of vehicles, click here.

To fight back against business-killing auto tariffs, click here to register for AIADA's Washington, D.C., Fly-In.

Nissan, Renault and Mitsubishi Executives Reaffirm Importance of Alliance

The chief executives of Japan's Nissan and Mitsubishi Motors met with the newly appointed chairman of Renault in Tokyo on Thursday and reaffirmed the importance of their three-way alliance, Mitsubishi CEO Osamu Masuko said. Masuko made the comments to reporters after what he said was a nearly two-hour meeting at a Tokyo hotel. Separately, Nissan Motor CEO Hiroto Saikawa told reporters that the issue of a merger between Nissan and Renault did not come up, nor did the issue of Nissan's chairmanship. According to Reuters, Renault SA Chairman Jean-Dominique Senard was in Tokyo for a two-day visit on Thursday, where he was expected to try to reaffirm an alliance that has been rocked by the arrest and ouster of its main architect, former chairman Carlos Ghosn. For more, click here.

At 88 days, Inventories Are Highest in 5 Years

Automakers and dealers began February with an 88-day supply of inventory, the most in five years, as a weather-hindered sales rate in January conspired with a spike in light trucks stocks. All three Detroit automakers had more than a 100-day supply. Automotive News reports that the industry had an estimated 4,015,500 unsold vehicles on hand after January, up from 3,883,800 vehicles, an 84-day supply, at the same point in 2018. The gross number of unsold vehicles crept back above 4 million for the first time since the start of December. January 2014 was the last time the industry had at least an 88-day supply. About 72 percent of inventory at the start of February consisted of light trucks, vs. 28 percent cars. Among automakers, Subaru continued to hold the industry's tightest supply: 42 days. Click here for more, including which brands have the longest supplies.

AP Fact Check: Trump Hails Auto Revival That’s Not Happened

President Donald Trump is hailing a renaissance in U.S. auto manufacturing that has not happened, according to the Associated Press. The industry is chugging along without the “massive numbers” of car companies that he says are setting up shop in the country. Always eager to claim a manufacturing revival, Trump in recent weeks has spread the notion that car makers are rushing to produce in the country. It’s become a leading justification for his apparent evolution on legal immigration, although whether he’s really changing on that subject is suspect, too. He now says the U.S. needs more foreign workers to keep up with the demand. But he’s misrepresenting the state of the auto industry. Since Trump took office in 2017, auto manufacturing employment has risen by about 51,000 jobs to just over 1 million, according to the Labor Department. That’s a 5 percent increase over two years. For the complete fact-check, click here.

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A Car-Crazy Artist Photographed an Exploding Lamborghini Miura [Maxim]

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