What Happened: The latest draft report on the U.S. Commerce Department's investigation into whether auto imports could pose a threat to national security includes three options for U.S. President Donald Trump, according to a Jan. 10 report by Inside U.S. Trade. The options include a 20 to 25 percent blanket tariff on autos and auto parts, a narrow list containing tailored restrictions on technologies related to automated, connected, electric and shared vehicles, as well as a third option that is more comprehensive than the tailored list but less restrictive than the blanket tariff.
Why It Matters: Given the draft report's options, it is likely that the report will conclude that auto imports harm U.S. national security. While foreign automakers would experience the least degree of damage if Trump chooses the second option, it would still affect U.S. imports of electric vehicles from Europe and Asia and their components, raising the price of imported car batteries.
Background: The Commerce Department has until Feb. 17 to submit its final report to the president. Once that occurs, the president will have 90 days to decide whether to reject or accept the report and determine what – if any – action he should take.
- For Trump's Auto Tariff Threats, Credibility Is the Name of the Game (Nov. 15, 2018)
- U.S. Auto Tariffs Would Deliver a Particularly Painful Sting to South Korea (Oct. 8, 2018)
- What Higher U.S. Car Tariffs Could Mean for Europe (Aug. 27, 2018)