General Motors warned Friday that if President Trump pushed ahead with another wave of tariffs, the move could backfire, leading to “less investment, fewer jobs and lower wages” for its employees.
The automaker said that the president’s threat to impose tariffs on imports of cars and car parts — along with an earlier spate of penalties — could drive vehicle prices up by thousands of dollars. The “hardest hit” cars, General Motors said in comments submitted to the Commerce Department, are likely to be the ones bought by consumers who can least afford an increase. Demand would suffer and production would slow, all of which “could lead to a smaller G.M.”
The president has promoted tariffs as a way to protect American businesses and workers, aiming at dozens of nations with metal tariffs, as well as bringing broader levies against Chinese goods. But companies, which rely on other markets for sales, production and materials, have been increasingly vocal about the potential damage from his policies.
The warning by G.M., echoed in comments by trade groups and other automakers, could test the president’s aggressive approach to trade and his commitment to business. In the past, Mr. Trump has lauded General Motors for its job creation and vowed to defend the auto industry.
A G.M. spokeswoman, Dayna Hart, said that the company had no contingency plans calling for job cuts, but that such a move was “something that could happen.”
“We are still assessing the impact,” she added.
The White House did not respond to a request for comment.
G.M. and other industry leaders are caught in the middle of an escalating trade war that has prompted retaliation from the European Union, Mexico, Canada and China.
Last month, Mr. Trump ordered an investigation into whether imported cars and automotive components pose a national security risk, calling for penalties expected to be as high as 25 percent. The administration has already put levies on imported steel and aluminum, and is about place tariffs on $34 billion worth of Chinese goods.
G.M. and other automakers rely heavily on parts and materials from overseas to build their cars. The president’s threat to pull out of the North American Free Trade Agreement could hurt the industry’s supply chain, which integrates operations in the United States, Canada and Mexico.
“If there’s a full-blown trade war, it will be pretty tough for the auto industry and consumers,” said Michelle Krebs, an analyst at AutoTrader.com.
“Consumers are already facing headwinds in credit and average prices going up,” she said. “If you add a tariff, my guess is a lot of people just won’t buy new cars.”
The increasingly global nature of automotive supply chains has left manufacturers especially exposed.
This week, Harley-Davidson said it would move some of its production outside of the United States to avoid retaliatory measures by the European Union. The company said it was the only “sustainable option” to “maintain a viable business in Europe.”
The decision invoked the ire of the president, who quickly threatened punitive taxes. He accused the Wisconsin-based motorcycle maker, which he had cited as a poster child of American manufacturing, of having “surrendered.”
Fiat Chrysler Automobiles, which has several plants in the United States, is also considering other manufacturing options, according to a Bloomberg interview with Bob Lee, an executive overseeing powertrains for the company.
“It’s contingency planning on a massive scale — supply-based planning, logistics planning, vehicle-build location planning,” Mr. Lee told Bloomberg on Thursday. “This is not trivial, and it’s been going on for awhile.”
G.M. and its chief executive, Mary T. Barra, have been at odds before with the Trump administration.
Last year, after Mr. Trump blamed both white supremacists and the groups protesting them for violence in Charlottesville, Va., Ms. Barra and other executives weighed disbanding an elite council formed to advise the president on economic issues. Mr. Trump shut down the group before they could dissolve it.
In criticizing prospective auto tariffs, G.M. played heavily on its position as one of the country’s largest employers. The company said it had 47 manufacturing locations, 25 service-part facilities and 110,000 employees in the United States, where it conducts most of its research and development, design, engineering and other work.
G.M. suggested that additional tariffs would put American companies at a disadvantage in the midst of a “fast-paced transportation revolution led by cutting-edge technologies.” Its investments in jobs and operations at home, the carmaker said, are critical to this effort. “The economic fortitude of companies like ours directly supports the economic strength of the nation, which, in turn, contributes to the security posture of the United States,” the company said.
The Commerce Department will hold public hearings in a few weeks on the auto tariffs, before it releases the results of its investigation. The government said it had received 2,500 comments already and expected more by the deadline on Friday.
“The purpose of the comment period,” the commerce secretary, Wilbur Ross, said in a statement, was “to make sure that all stakeholders’ views are heard, both pro and con.”
“That will enable us to make our best informed recommendation to the president,” he added.
In a highly intertwined, global car industry, a trade war can play out in unexpected and costly ways. American automakers, which export an estimated two million vehicles, increasingly rely on global sales as a buffer in tough times. Retaliatory tariffs from Europe or China could weaken their overseas business.
They also depend heavily on parts from foreign suppliers. G.M. has said that its supply chain sprawls across 20,000 businesses worldwide and is an operation of “great breadth, scope and complexity.”
European and Japanese automakers are major employers in the United States, supplying hundreds of thousands of jobs. Daimler, the maker of Mercedes-Benz cars, recently issued a profit warning, in part blaming tit-for-tat measures for weakness in its sales of S.U.V.s, which are built in Alabama.
The German automaker BMW, which has a large factory in South Carolina, said in a comment about tariffs that the protectionist approach would make American companies less incentivized to improve their productivity.
“The deeper the economic ties from trade and integrated value chains, the more costly conflict would be, and therefore the more unlikely it is to occur,” BMW said.
Toyota wrote in its submission to the Commerce Department that the cost of its popular Camry sedan would rise $1,800 if subject to new tariffs. The car is built in Kentucky while sourcing 30 percent of its materials from abroad.
The Japanese automaker said that the tariff, if approved, would be terribly timed. The auto industry is at a vulnerable point in its sales cycle, exiting a long stretch of record growth and heading into a period of weaker demand.
The Alliance of Automobile Manufacturers, a Washington-based trade group that represents foreign and American companies, was more specific.
With a 25 percent tariff, the average price of an imported vehicle would rise by $5,800, the group said in a statement. Annual sales would slide by one to two million vehicles. And production would slip 1.5 percent, causing 195,000 workers in the United States to lose their jobs.
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