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Friday, 07 June 2019 17:10

Trump’s Mexico Tariffs Would Cripple U.S. Automakers

Written by Adam Shapiro, Yahoo Finance
Workers inspect General Motors Co. (GM) Chevrolet 2019 Silverado HD and 2019 GMC Sierra HD pickup trucks on the assembly line at the GM plant in Flint, MI, on Tuesday, Feb. 5, 2019. GM is selling lots of expensive pickup trucks and sport utility vehicles in the U.S., which helped its average vehicle sales price hit a record $36,000. Workers inspect General Motors Co. (GM) Chevrolet 2019 Silverado HD and 2019 GMC Sierra HD pickup trucks on the assembly line at the GM plant in Flint, MI, on Tuesday, Feb. 5, 2019. GM is selling lots of expensive pickup trucks and sport utility vehicles in the U.S., which helped its average vehicle sales price hit a record $36,000. Jeff Kowalsky / Bloomberg via Getty Images

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“If Mexico fails to act, tariffs will remain at the high level, and companies located in Mexico may start moving back to the United States to make their products and goods,” he said.

 

But Slok pointed out that manufacturing doesn’t work that way. “If you cripple the U.S. auto industry it will have implications for the auto industry in the rest of the world,” he said.

 

Lindland agrees. “We can’t just turn on a dime. We are about making good solid affordable vehicles for consumers and if you disrupt the supply chain you are disrupting jobs, dealers, consumers.”

 

According to Lindland, automakers have created an efficient manufacturing process to keep prices down for consumers. Setting up shop in the U.S. won’t be easy she says. It’s a complex and extensive process, “We are not interchangeable. We can’t just swap things out.”

 

We thank Yahoo Finance for reprint permission.

 


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