- President Donald Trump took his shoulders on concerns That its car prices will bring manufacturers to manufacturers to increase prices, saying that it will not care if they do. In an interview with NBC News, he added that: “I hope they will increase their prices, because if they do, people will buy American manufacturing cars.” But even cars assembled in the United States have parts made abroad.
President Donald Trump said his new car rates were permanent and have ignored the concerns they will get car manufacturers to increase prices.
In a Interview with NBC News Saturday, he was asked about a recent Wall Street Journal According to the report, he warned the CEOs of not increasing prices while discussing the prices with them.
“No, I never said that. I don’t care if they increased prices, because people will start buying American manufacturing cars,” replied Trump.
He added: “I don’t care. I hope they will increase their prices, because if they do, people will buy American manufacturing cars. We have a lot.”
Trump later said that if prices on foreign cars increase, consumers will buy American cars.
He also confirmed that the prices were there to stay, saying: “Absolutely, they are permanent, safe. The world has been getting the United States for 40 years and more. And all that we are doing is just, and frankly, I am very generous.”
The automotive parts made abroad would also be affected by a price of 25%, but vehicles and parts imported within the framework of the trade agreement of the US-Mexican-Canadian agreement will not see the rights until the government establishes a process to impose them, said the White House.
While more than half of the value of imported automotive parts came from Mexico and Canada last year, more than $ 70 billion came from areas not covered by the USMCA pact, including Asia and Europe, according to data from the International Commercial Association Quoted by the Associated Press.
American and foreign car manufacturers have integrated closely supply chains that extend over North America. During the manufacturing process, cars and parts can cross several times between the United States, Mexico and Canada.
Even Trump Ally Elon Musk warned that Tesla, who manufactures all her cars sold in the United States at the national level, will be affected by car rates.
Wedbush Securities analyst Dan Ives estimated that cars prices could increase from $ 5,000 to $ 10,000 due to car rates, depending on a vehicle is a general public or a premium brand.
“Each automaker in the world will have to increase prices in a form that sells in the United States, and the logistics of the supply chain of this tariff announcement heard in the world is difficult to put our arms right now,” he wrote in a research note on Friday.
While the White House has said that prices are intended to revitalize the American industrial base, Ives is skeptical of the fact that car manufacturing can be fully relaunched.
Indeed, even cars built in America are equipped with parts and components manufactured abroad which constitute 40% to 50% of their value.
“An American car with all the American parts made in the United States is a fictitious story that is not even possible today,” he added.
This story was initially presented on Fortune.com
