May 20, 2019

President Trump Delays Section 232 Auto Tariffs

Last Friday, U.S. President Donald Trump delayed for six months a decision about whether to use his Section 232 trade powers to impose duties or quota restrictions on imports of automobiles and auto parts. The president also announced he would exempt imports from South Korea from the penalties if he does eventually move forward with them.

According to Politico Pro (subscription required), in 2018 the United States imported $174 billion worth of passenger cars, $157 billion in parts and $43 billion in other vehicles. Those figures would mean a 25 percent tariff on all autos and auto part imports would be one of Trump’s largest trade actions yet, second only to the tariffs imposed on $250 billion worth of Chinese goods.

In a formal proclamation, President Trump directed U.S. Trade Representative Robert Lighthizer to pursue the negotiation of agreements with the European Union, Japan and other countries that address the alleged national security threat posed by auto imports. The president asked for an update on the progress of such negotiations within 180 days.