Section 232 Tariffs on Automobiles and Automotive Parts

Background:

Section 232 of the Trade Expansion Act of 1962 allows the president to impose tariffs on imports that the Department of Commerce deems a threat to the United States’ national security.

In 2018, the Department of Commerce launched Section 232 investigation on passenger vehicles and automotive parts to evaluate “whether such imports are weakening our internal economy and may impair the national security” and subsequently sought public comments to inform their investigation.

MEMA submitted comments, testimony, rebuttal comments and a public statement in opposition of any potential Sec. 232 actions on automobiles or vehicle parts. Over 2,300 comments were filed; virtually every major vehicle industry stakeholder are opposed (view the Regulations.gov docket for more).

Status:

November 30, 2018 – the Office of the U.S. Trade Representative published side letter agreements with Canada and Mexico regarding potential Sec. 232 tariffs on autos and parts.

• U.S.-Canada 232 Side letters regarding 1) Process and 2) Quotas
• U.S.-Mexico 232 Side letters regarding 1) Process and 2) Quotas

February 17, 2019 – Department of Commerce announced submission of its report on Section 232 for Automobiles and Automobile Parts to the President. The report has not been made public.

May 17, 2019 – President Trump issued a presidential proclamation on Adjusting Imports of Automobiles and Automobile Parts Into the United States. No report details were released.

• The President’s proclamation concurred with the Commerce Secretary’s recommended actions to adjust automotive imports so that they will “not threaten to impair the national security.” 
• The United States Trade Representative was directed to negotiate agreements – which was one of the Commerce Secretary recommendations – to address the national security threat causing harm to the American automobile industry. It further noted that “if agreements are not reached within 180 days, the President will determine whether and what further action needs to be taken.”

September 30, 2019 – As part of the first-phase U.S.-Japan Trade Agreement, it was reported that the U.S. pledged not to impose Sec. 232 auto tariffs on Japan.

October 23-24, 2019 – MEMA Congressional Fly-In event to urge Members of Congress to weigh in with the White House in opposition to placing tariffs on imported automobiles and vehicle parts.

(TBA) on or before November 14, 2019 – The 180-day timeframe ends; the President will decide whether to impose tariffs and/or take other action.

MEMA Staff Contacts:

Catherine Boland, Bill Frymoyer, Leigh Merino

Additional Resources:

• Driving American Jobs Coalition https://www.drivingamericanjobs.com/
• Center for Automotive Research report “Consumer Impact of Potential U.S. Section 232 Tariffs & Quotas on Imported Automobiles & Automotive Parts”

Take Action:

Contact your members of Congress today and urge them to voice their opposition of potential tariffs on autos and auto parts to the administration.