Tariffs, the American Automobile Industry, and Tesla
AMERICAN AUTOMOBILE INDUSTRY Tariffs on imported cars should help American car companies. But it is more complicated. Tariffs on "Mexico" will hit American car companies and their suppliers particular hard. Trump has threatened to raise tariffs on Canadian car imports in order to "permanently shut down the automobile manufacturing business in Canada." Most of the imported cars from Canada are made by American car manufactures. Almost half the cars sold in the United States are imports. About 23% of cars sold in America come from Mexico; another 10% come from Canada. Most of them are assembled by American car companies. About $100 billion in parts and subassemblies cross the border and will have to pay the tariff, in addition to the tariff on completed cars that are imported. Price of cars in America will go up and possibly car sales will go down. American car manufacturers are in poor financial shape and cannot afford to absorb the cost increases. O...