Trump vaguely tweets about 'big news coming' for United States auto workers

Honda’s exports from Japan would be hit if the tariffs go ahead. The Nikkei share index closed down more than 1 per cent after news of the investigation broke

Trump administration launches vehicle import probe

The White House says Trump has asked Commerce Secretary Wilbur Ross to consider whether imports of cars and trucks and automotive parts threaten US national security.

The trade dispute took on added complexity this week when U.S. President Donald Trump announced a national security investigation into imports of cars and trucks, a probe that could lead to tariffs against China as well as key U.S. allies such as Canada, Mexico, Japan and Germany.

Reuters confirmed a report by the Wall Street Journal that the administration was considering launching a "Section 232" investigation into auto imports that could see tariffs of up to 25 percent imposed on imports.

"There is evidence suggesting that, for decades, imports from overseas have eroded our domestic auto industry", Commerce Secretary Wilbur Ross said in a statement, promising a "thorough, fair and transparent investigation".

Germany's association of industry groups said auto tariffs would be a "provocation" and "another nasty blow to our economic relations" with the United States.

Section 232 is the same statute that was invoked to allow the administration's tariffs on steel and aluminium imports.

The Trump administration's shock decision targeting the likes of Volkswagen and Mercedes comes as the June 1 deadline approaches for the USA to decide whether to exempt the European Union from the controversial steel and aluminium tariffs.

But the auto tariffs are also aimed at something else, experts say. It has, though, driven the U.S.'s trade policy even further off-road.

"The prospect of a tariff on imported vehicles is obviously disconcerting and I would think particularly so for American consumers who would end up paying more for their vehicles", he said Thursday.

BMW and Mercedes have expanded production capacity in the United States, but BMW, Audi, Volkswagen and Daimler have also invested billions to build new factories in Mexico in the hope of selling locally produced cars into the United States.

Trump charges Naval Academy graduates with mission of victory
Winning is such a great feeling, isn't it a great feeling? "We're building that modern fleet", he said. The president said he would stay to shake the hands of all roughly 1,100 graduates Friday.

The biggest exporters of new passenger vehicles and light trucks to the United States previous year were Mexico, Canada, Japan, Germany and South Korea, according to U.S. government figures.

Currently, the USA charges just 2.5% on vehicle imports, which is lower than the European Union's 10% and China's 25% - although the latter country will lower its tariff to 15% from 1 July.

Auto trade has been a big sticking point in talks between the United States, Mexico and Canada as they try to update NAFTA.

Although a large portion of the US's most popular vehicle models, including those from foreign brands (such as the upcoming BMW X7), are already manufactured within its borders, many are imported from other countries.

U.S. Senate Finance Committee Chairman Orrin Hatch said possible auto tariffs are "deeply misguided", and urged the administration "to remain focused on addressing China's trade practices".

"Arguing that passenger cars are a national security issue doesn't pass the laugh test", he said.

Trump has sought to overhaul NAFTA in an effort to return auto production to the United States and reduce America's trade deficit.

"As a global manufacturer, Geely Holding Group is in favor of free trade and open markets".

Trump had earlier blamed the U.S. neighbors to the north and south for being "difficult" in talks to renegotiate the pact.

"They make it impossible for our cars (and more) to sell there".

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