On the heels of tariffs issued on imported steel and aluminum, President Trump has ordered the U.S. Department of Commerce to conduct an investigation into whether imported vehicles and vehicle parts constitute a threat to national security.
As with the steel and aluminum investigations, the probe of autos and auto parts will be conducted under the authority of Section 232 of the Trade Expansion Act, which was designed to determine whether tariffs should be levied against imported goods that potentially harm U.S. industry.
The investigation will encompass passenger vehicles including SUVs, vans and light trucks, the Commerce Department said.
"There is evidence suggesting that, for decades, imports from abroad have eroded our domestic auto industry," Commerce Secretary Wilbur Ross said when introducing the investigation late on May 23.
Over the past 20 years, passenger vehicle imports have gone from 32 to 48 percent of the vehicles sold in the U.S., according to a Commerce press release.
"From 1990 to 2017, employment in motor vehicle production declined by 22 percent, even though Americans are continuing to purchase automobiles at record levels," the agency said.
"Now, American-owned vehicle manufacturers in the U.S. account for only 20 percent of global research and development in the automobile sector, and American auto part manufacturers account for only 7 percent in that industry," it said.
In a May 24 statement, the Motor & Equipment Manufacturers Association said it opposed the Section 232 investigation.
“MEMA concurs that national security depends on the economic security of the country,” the association said. “Motor vehicle parts manufacturers are a critical element of this agenda.”
Nevertheless, imposing Section 232 tariffs on imported auto parts would put both American jobs and national security at risk, according to MEMA.
Employment in the auto parts industry is now at 871,000, up 19 percent from five years ago, according to MEMA.
“This growth in jobs has been possible because motor vehicle parts suppliers operate in an integrated, complex global supply chain,” it said. “Access to worldwide markets is critical for the motor vehicle parts industry to remain competitive.”
Trump issued tariffs of 25 percent against imported steel and 10 percent against imported aluminum March 8, though he later allowed various exemptions.
Organizations such as the U.S. Tire Manufacturers Association and MEMA protested the decision, on the grounds that so much of U.S. industry, including tire manufacturing, is dependent on imported steel.
Officials of the United Steelworkers union could not be reached for comment.