According to Reuters, auto industry associations and executives say the next president of the United States, Donald Trump, may impose new import tariffs on vehicles from Mexico and other potential countries, and abolish a number of existing electric vehicle support policies.
Automakers are preparing for this.
Tesla, Rivian, Lucid and battery maker LG New Energy have all joined the Zero Emission Transportation Association, saying they are ready to work with Trump.
“the next four years are critical to ensuring that these technologies are developed and deployed by American workers in US factories and will benefit future generations,” the association added.
” It is worth noting that Tesla’s share price rose nearly 15% at the close of trading on Nov.
6 as investors bet that the company would benefit from its CEO Elon Musk’s close relationship with Trump.
Trump has repeatedly warned that he will impose tariffs of 200 per cent or more on cars imported from Mexico and may also impose tariffs on cars imported from Asia and Europe.
Trump wants to block imports of cars from China, but is open to Chinese carmakers making cars in the United States.
In August, Trump said: “We will provide incentives that if China and other countries want to sell cars in the United States, they have to build factories here and hire our workers.
” Mark Williams, president of location service company Strategic Development Group, expects demand from his company to grow, but says tariffs may also lead to higher costs.
South Korea’s trade minister said he expected South Korean companies to invest more in the United States if Trump raised import tariffs.
Honda has an annual production capacity of about 200000 vehicles at its Mexican plant, 80 per cent of which are exported to the US market, according to Shinji Aoyama, Honda’s chief operating officer.
If the United States imposes permanent tariffs on cars imported from Mexico, Honda will have to consider shifting car production.
Toyota makes Tacoma trucks at two factories in Mexico, and sold more than 230,000 of the model in the United States last year.
Trump’s high tariffs on imports from Mexico could prompt Toyota to shift production of models such as the Tacoma to San Antonio, Texas, according to a person familiar with the matter.
A Toyota spokesman declined to comment.
In addition, Trump said he plans to abolish EPA and Department of Transportation regulations on vehicles on his first day in office, and is considering cutting or abolishing tax breaks for electric vehicles and other incentives.
The American truck Association called on Trump to replace the EPA’s stricter emission standards with a US national emission standard that is “technically feasible and in line with the current state of operation of important industries in the United States”.
Trump also plans to abolish California’s policy of setting its own car emissions regulations.
In addition, Trump will decide how to allocate billions of dollars in subsidies for electric vehicle charging.
The regulatory changes may give automakers more flexibility to produce more profitable gasoline-powered SUV and trucks, but people are also curious about the future of billions of dollars in US state subsidies for electric car batteries and manufacturing spending.
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