A US Commerce Department report has concluded that American auto imports threaten national security, setting the stage for possible tariffs by the White House, a person familiar with the matter said Thursday.
The investigation, ordered by President Donald Trump in May, is ‘positive’ with respect to the central question of whether the imports ‘impair’ US national security, said a European auto industry source.
The report, which is expected to be delivered to the White House by a Sunday deadline, has been seen as a major risk for foreign automakers.
Trump has threatened to slap 25 percent duties on European autos, especially targeting Germany, which he says has harmed the American car industry.
Trump will then have 90 days to decide whether to move ahead with tariffs.
The White House has used the national security argument – saying that undermining the American manufacturing base impairs military readiness, among other claims – to impose steep tariffs on steel and aluminum imports, drawing instant retaliation from the EU, Canada, Mexico and China.
Trading partners have sometimes reacted with outrage at the suggestion their exports posed a threat to American national security.
Automakers, including from the United States, have criticized tariffs as a tool that could hit auto sales and damage the employment picture throughout the industry.
‘If tariffs go up, it’s not good for the consumer it’s not good for our dealer network it is not good for the economy in total,’ said Bernhard Kuhnt, CEO of BMW North America, told CNBC on Wednesday.
‘I’m not a politician but we’ll deal with the consequences,’ he added.