As the U.S., Mexico, and Canada enter into the final day of the seventh round of NAFTA renegotiation talks, President Trump is offering his neighbors an incentive for signing a favorable deal.
“Tariffs on Steel and Aluminum will only come off if new & fair NAFTA agreement is signed,” Trump tweeted on Monday morning.
The president’s surprise announcement of tariffs on imported aluminum and steel late last week — 10 percent on the lighter metal, 25 percent on the heavier one — sent automaker stocks tumbling. Hoping to quell fears of new vehicle price increases, General Motors and Toyota released statements claiming the bulk of their aluminum and steel flies a red, white, and blue flag.
Quick out of the gate, the American International Automobile Dealers Association stated, “Both metals are crucial to the production of cars and trucks sold in America today and would raise the sale prices of those vehicles substantially.”
While the proposed tariffs would be a boon for domestic producers of steel and aluminum, the potential for inflated window stickers comes as auto sales cool off in the United States. Trump later applied the tariff threat to imported European vehicles (in the event the European Union retaliates).
Speaking on CNBC Friday, U.S. Commerce Secretary Wilbur Ross predicted a “trivial” price impact on vehicles, given that steel goes for $700 a ton. Ross’s desire for tariffs apparently won out over the president’s chief economic advisor, Gary Cohn, who opposed the creation of tariffs.
According to Ducker Worldwide-FSG, the average U.S. vehicle is 11 percent aluminum and 54 percent steel. Factoring in metal waste during the production of parts, the research firm estimates an average vehicle (weighing 3,835 pounds) uses 526 pounds of aluminum and 2,925 pounds of steel. Analysts suggest a tariff could add $200 to $300 to the price of a new vehicle.
So far, Ford, Honda, and Toyota have issued statements warning of negative tariff consequences.
Make them smaller for a change.
Less metal, less fuel, more sporty.
It’s like a cold war with having to be bigger than the other vehicles.
Eating less junk fuel may make smaller cars more palatable.
That actually happened in the late 1970s and 1980s. Cars got smaller, lighter, and more economical. Just as an example, from 1976 to 1985, a Buick Electra lost 36 inches in length, nearly 8 inches in width, and nearly 1,700 pounds in weight. So what happened? American buyers started turning to trucks and SUVs.
It also got choked engines and crappy box styling. That Electra ended up a sad shadow of its former self, and was a ridiculous flagship for Buick.
“It also got choked engines and crappy box styling.”
TRIGGERED.
Ah, the famed “They’ll give you whatever you want if you start out raving like a loon” negotiating ploy. I remember this worked so well when Trump used it to get Mexico to pay for that shiny new wall.
So renegotiating Nafta isn’t in effect making Mexico pay?
Not when Mexico tells Trump where to stick his tariffs and simply increases trade with Asia, Canada and Latin America, no.
you can’t just trade with somebody else…if there is nobody there to buy your goods.
80% of the world’s GDP, and 95% of its population, lies outside of our borders. Somehow I think they can find people to sell to.
TrailerTrash,
80% of global trade is not America.
You see trade and prosperity improve when you have trading agreements.
Nope.
Hmm, I wonder if this billionaire, who’s assets are neither disclosed nor in a blind trust, has managed to make the connection between his tweets and volatility in the stock market.
I mean, there’s certainly no reason for him to announce policies that hurt specific industries or companies one day, only to walk them back sometime during the next trading cycle.
No way a billionaire would be able to use power like that to enrich himself, is there?
What makes you think that billionaires act any differently than any other humans?
Nothing. He’s just got more reasons to do so. If he can tank a stock, invest $X00,000,000, then back-track and make 20%, he’s more likely to do so than someone who’s only got 5 or 7 figures to invest.
And if you can clear $20 mill in a day, you can give half of that to lawyers to keep your butt out of jail, and still have a pretty good day.
So should Mueller go to the SEC? Or is this just idle gossip?
Fun fact, while George Washington wasn’t the richest American, he is reputedly the richest President when valuations armed normed to current day. Does this make the Indispensable Man an evil 1% er?
Before you get all indignant, DT isn’t GW. But his financial circumstances are nothing new.
In trumps own words investigating his finances would be a red line.
Sure officer, I’ll take the breathalyzer, just don’t look in the trunk
Feds,
What Trump needs to realise the 1% might get upset if he continues. His actions are not only making countries and business uncomfortable, but rich individuals, middle class and poor as well.
I bet he sleeps with one eye open.
All the noise from Europe distracted from the fact that Canada is the biggest supplier of steel and aluminum to the U.S. Now we see that Trump’s floating of proposed tariffs on those commodities is likely a negotiating tactic to get a better NAFTA deal.
Most of the reporting I’ve seen has put front and center the fact that Canada is our biggest steel supplier, and that for all of Trump’s lashing out at China, we actually had a larger trade deficit with China last year than we’d ever had before, but Trump is instead attacking trade with a close ally with whom we actually have a trade _surplus_.
Canada doesn’t make steel nor does Mexico make aluminum. Trump is shutting down NAFTA because is a back door for China to route products into USA paying minimum tariffs. 16% of Mexico’s imports are car parts, aluminum & steel from China. 88% of Mexico’s exports is the US car market. Canada & Mexico have zero leverage, NAFTA will end China’s back door bring jobs back to US.
Canada doesn’t make steel??
Might like to check your facts there.
China provides half of all the steel billet in the world. Majoity of Canadian companies extrude steel. Canada tried to make their own deal with China but China refused citing only interested in the US market. NAFTA is the back door via Canada and Mexico for China exports into US markets
This is what Trump is ending.
Ah the “Trump Is A Genius” justification.
If he ends up doing it, he’s a genius because he knows (against the wisdom of every reputable economist) that tariffs will somehow save American jobs (they won’t).
If he ends up not doing it, he’s a genius because it was a negotiating tactic all along.
Hint: Trump is not a genius.
He’s also stable, apparently.
Every Wall Street global economist. Main Street economist have a different view.
Is “Main Street economist” the euphemism we’re giving to people who haven’t studied economics but know what’s right, by gum, and they know they trust that man with the pretty wife they see on the teevee?
Ronnie,
So the NAFTA talks aren’t going well.
I just read Canada and Mexico will dig in.
Also, if the US decides on the metal taxes most of the excess metal in the global market will be used in SE Asian countries. They are booming.
I think Trump will find it hard to justify a tariff on global metals because he can’t get what he wants in NAFTA.
Boy, Trump is a shamateur and a fool.
@ Ronnie, however the relative value of steel exports from the USA to Canada and Canadian exports to the USA is a ‘wash’. Then add in the fact that Canada imports a great many of the required raw materials to produce steel from the USA and that what was Canada’s largest steelmaker (Stelco) is owned by an investment firm based in Florida.
Ronnie,
Have a read of this Bloomberg link. Hyundai/Kia and Toyota might have different ideas to Trump’s bullsh!t.
You see Trump is the leader of a country and he’s making a mockery of US Presidency.
Some in the US need to realise the damage this moron is causing and jobs lost. How many investments within the US have been stalled since Trump was elected?
https://www.bloomberg.com/news/articles/2018-03-05/with-friends-like-these-trump-s-tariffs-hurt-asian-allies
WOW!
Big AL-
It’s amazing how for 8 years President Obama cost the US prestige and aggravated our allies and you didn’t care.
It was amazing how much damage that President caused and the jobs lost. How many investments within the US were stalled because he was elected?
But at least you aren’t ranting about how much you hate trucks from North America….. which is a good thing.
That’s an interesting read of reality. I always suspected Trump was retroactively behind the economic recovery since 2009 much as Obama was retroactively responsible for the 2008 crash. Because Obama was *certainly* responsible for the long wave of automation. He also started the Iraq War, gave the German Chancellor an uninvited back rub, bragged of sexual assault to a TV host, paid a porn star to keep her mouth shut about their affair, and is loved as a useful idiot by Xi Jinping because he’s created a power vacuum on the world stage that the Chinese leader is all to willing to fill. But Trump’s inauguration crowd was the largest *ever* and it God made sure it didn’t rain. Dignity is back, baby!
As always, we see what we want to see.
Actually, US prestige improved greatly with our allies under Obama (compared to Bush II and the Dotard-in-Chief), but totalitarian regimes like the ones under Putin, Xi, Erdogan, Duterte, etc. disliked Obama immensely – cuz, you know, things like human rights.
Otoh, the autocrats have a lot less problem with the Dotard.
The smart money up here knows we can’t win this game. Now its a case of how bad are we going to lose.
Canada’s ace card is our abundant fresh water supply. California is so parched it’s filling taps with desalinated water. President Reagan attempted to unilaterally declare Canadian water a “continental resource”, free for the taking by the U.S. It isn’t over until it’s over!
If you’re referring to the Great Lakes, the US and Canada does share that resource. Long before (and since) Reagan, Southern and Western US States have eyed all of that fresh water hungrily.
Fortunately, for the Midwestern Great Lakes states, the agreement we have with one another and the Canadian provinces surrounding them is a strong one and not likely easily overturned.
Now if we could just keep Nestle from bottling the water near the lakes, that would be great.
Zebra mussels, and now Asian carp, are a bigger problem than Nestle. I love watching videos of Asian carp, those trolling motors drive them bonkers, lol.
My water comes from the Great lakes..I specify” Canadian” water only
The American water is 25% more expensive : ) !
Nestle doesn’t bottle near any of the Great Lakes, the closest is Guelph Ont. The other Hope BC
“Canada’s ace card is our abundant fresh water supply.”
If I remember from school it’s half of the world’s fresh water supply. Plus there’s that whole Northwest Passage that goes through Canada but the US insists is international waters.
“The smart money up here knows we can’t win this game.”
Exactly, Mikey! Clear and concise. An economic reality.
The win/win balance is achieved if all parties can find a way to accommodate Trump’s goal of trade parity so all can save face.
It may be of interest to some readers to research Trump, the man, and his enormous track record of business dealings.
He didn’t always win every argument, but he sure put the hurt on many of his adversaries, often driving them out of business.
The sticking point with the current NAFTA re-negotiations is the trade advantage that both Canada and Mexico have enjoyed for decades over the US.
Trump wants trade parity, a fair and equitable trade arrangement that is mutually beneficial and does not leave the US on the financially losing end of the deal, like it has been for the past 25 years.
But all is not lost. If NAFTA has to be killed because no agreement can be reached, then individual trade agreements can be more readily achieved based on individual trading needs and accommodations.
He also put the hurt on his own business dealings. I’d rather that the United States not be Trump’s bankruptcy number eight.
Also, we have a trade surplus with Canada. What is this “trade advantage” that Canada enjoys with us?
Trump took advantage of the bankrupture laws to come out ahead.
In the business world, a lot of people and companies do that.
I know a guy who declares personal bankruptcy every seven years or so and has successfully done this three times in his life.
He’s got a better lifestyle and more money than I do. Gambles with other people’s money and defaults. For some it is a way of life, and it’s all legal.
Welcome to Capitalism.
“Gambles with other people’s money and defaults.”
Yes, except this time it’s _our_ money. The fact that it’s arguably not illegal for him to irreparably screw our country for personal profit is not much comfort.
You should not have voted for him. Now you’re stuck with him.
I didn’t vote for him. I know I’m stuck with him. What does that have to do with whether getting into dumb pissing contests with our trading partners is a smart economic move or not?
@highdesertcat: every time he declared bankruptcy there were American workers, and the employees of American contractors and suppliers who went without the money/wages that they were owed.
How is that helping the ‘common person’?
Arthur Dailey, Trump wasn’t interested in helping the common person back then. He was still in business for himself and out to make the big bucks.
I don’t know when Trump got his epiphany to run for POTUS but he got enough people to vote for him to make it so.
Don’t let your dislike for him cloud your objectivity because, so far, Trump has been good for a lot of American citizens.
HDC, you keep contending that Canada has a trade advantage over the US but the numbers say otherwise! There is already trade parity between Canada and the US under the current NAFTA. Claiming otherwise does not make it true. Trump is just using bully tactics to get what he wants in this case, which is NOT a fair deal.
BOC, it’s not MY contention! This is the premise that Trump is basing his re-negotiations of NAFTA on.
If Trump and his advisors believe there is parity now already, there would be no need for NAFTA re-negotiation.
If NAFTA so overwhelmingly favors the US, we would all celebrate it instead of looking for ways to scrap NAFTA and negotiate individual trade agreements with our neighbors.
It is a proven falsehood that the US has a trade deficit with Canada, according to the US government’s own accounting. Claiming otherwise does not make it true. There’s not really much more to say.
https://ustr.gov/countries-regions/americas/canada
“U.S. goods and services trade with Canada totaled an estimated $627.8 billion in 2016. Exports were $320.1 billion; imports were $307.6 billion. The U.S. goods and services trade surplus with Canada was $12.5 billion in 2016.”
BOC, someone forgot to tell Trump and his advisors because they are still looking at different stats and figures, and acting accordingly.
“BOC, someone forgot to tell Trump and his advisors because they are still looking at different stats and figures, and acting accordingly.”
Yes, those are called “alternative facts” I believe.
HDC, if you’d take a fraction of the time you spend being a shameless Trump acolyte and look at the pathological lying of this administration about the most basic verifiable facts, you might embarrass yourself less around here.
“Trump and his advisors say it’s so and I BELIEVE THEM!”
30-mile fetch, you got it all wrong.
I judge Trump on what I see he has done for America so far, and particularly for me and mine.
It’s been all good. Can’t say that for any president since Reagan.
So what if Trump lies? Other presidents lied too. Did anyone care then? NO!
You are letting your hate for Trump blind you to what he is doing for America. He’s winning over converts every day, even in blue-collar states.
I hope Trump keeps up the good work. His policies put money in the working stiffs’ pockets, have elevated retirement funds to astronomical levels, raised America’s productivity, mining, oil&gas drilling and employment to new heights. What’s not to like?
I’m not embarrassed at all. Trump has done good for me and I give credit where credit is due.
You may recall how vocal I was about the last guy in office as I saw what his redistribution of America’s wealth did for me, and people who worked for a living.
It’s refreshing to see a results-oriented guy like Trump at the helm.
My lifestyle has improved and everyone I meet now has a much more positive outlook of their lives.
Highdesertcat,
“He sure put the hurt on his adversaries”.
Why is Canada an “adversary”? Why is Australia an “adversary”?
I think you might have this wheeling and dealing president all wrong.
He doesn’t know how to deal. The guy states to world leaders one thing then he switches off and does the opposite.
You don’t do business that way.
It doesn’t matter how I have this wheeling and dealing president because I didn’t vote for him and yet I like everything he’s done for me so far.
I’m still operating on the principle of “Caveat Emptor” until it comes time to vote for him.
Credit where credit is due. This guy has had a positive influence on me and mine so far. And that’s a good thing (for us).
Interpretation of “adversaries”; You have taken the sentence out of context because it dealt with his past track record of wheeling and dealing with his adversaries back then.
Should Canada and Australia ever choose to be Trump’s adversaries, I am certain that Trump can deal with that. I believe him to be one mean motha fu..er when it comes to business. Only one thing matters: to win!
Just remember that Trump’s philosophy includes, “If you’re not with me, you’re against me.”
Plain and simple. No misinterpretation there.
@desertcat: declaring bankruptcy and not paying your debts is like putting your tail between your legs and running away. The opposite of being a ‘tough guy’. The POTUS has never been a ‘tough guy’.
Arthur Dailey, some people make a career out of just that. They utilize the law to the fullest.
Don’t let your personal dislike for Trump get in the way of seeing the bigger picture.
Trump is what he is, is where he is, and you’re not.
@desertcat: That is not always true. The Old Man spent a number of years on the Fraud Squad putting away ‘professional bankrupts.
And what of all those American citizens that went unpaid because their invoices and wages weren’t paid?
Is that ‘winning’?
The reason that the POTUS has not released his tax returns is because his net worth was nowhere near what he claimed. In a year or two after benefiting from his position, he will probably release his most recent return, because his net worth will have escalated to the point where he can brag about it. Which is not how being the President is supposed to work.
Arthur Dailey, I’ve got things in MY past that I could have done differently, so I chalk up Trump’s past exploits to the past.
Trump existed in a totally different world when he was in business. The things he did are no different from what others in similar situations have done over the decades.
If you’re interested look at the history of Las Vegas, NV, and the hanky-panky that was going on there outside of the mob’s influence. Lotta people didn’t get paid there either. No different than what Trump did on the East Coast.
I admire Trump for even seeking to be POTUS. Why would anyone with his lifestyle and money want to take two steps downward to the schit-job of being POTUS?
And it ain’t about power. Trump had a lot more power when he was in business outside of government. He was a free man then. Now he’s not.
Judging by the sheer number of regulations Trump has rescinded, replaced, canceled or otherwise neutered, I say he really cares about where America is heading.
I rather be on the Trump ride than relive that downward spiral ride of the last guy in office.
Why would I want to see Trump’s tax returns?
His enormous business record is one of multiple failures. Multiple.
His real estate was largely inherited. Most of the other enterprises that he tried to start and run were failures. Casinos, hotels, airlines, universities, steaks, etc.
Therefore he was unable to get financing from traditional western sources. Was relegated to licensing his name to structures constructed and run with
‘foreign’ money. Hence the possibility of ‘kompromat’.
One thing about Trump I found out when I did a little research into the man is that his life and ventures are very well documented. Both successes and failures.
While some people may not agree with the way Trump has run his life and businesses, he is where he is, and he’s got a lot of money.
That’s really all that matters in life, money and power, And he’s got both.
If there is a possibility of kompromat I’m sure Mueller will find it. But like any special investigations, they’ll end up far from where they were supposed to be.
Like the Clinton-Lewinsky matter. That started with White Water and ended up with semen on a Blue Dress leading to impeachment.
There were no six degrees to connect any of it to the original premise of the investigation.
The last half of the above posting I can agree with.
Drumpf is an MORON when it comes to business.
Drumpf would be worth many times more if he had simply put his inheritance into an index mutual fund.
Really, who other than a complete moron would start a mortgage company at the height of the RE bubble (when it was about to pop)?
His SIL, Kusher is also an idiot for overpaying for an office building at the height of the market – the debt load crushing his family’s business.
I’m going to bet they will give him a juice box and pudding cup, turn his favorite show on and in a couple of days this will all be forgotten. He will tweet big and dominate the news cycle but there is no follow up unless his staff is into it.
It’s a malignant narcissist’s prerogative to change his mind whenever the voices in his head tell him to.
Auditory hallucinations are no more inherent in malignant narcissism than they are in chicken pox. Had you diagnosed the POTUS with schizophrenia or one of many dissociative conditions, your statement would have been more accurate. I believe it was Mark Twain who said, “The only man who can’t change his mind, is the man who doesn’t have one”.
Just another thing to distract from the Russian investigation getting closer and closer by the day. It seems Putin’s poodle is getting more and more rattled.
^ This.
Why should we send our empty Budweiser cans and old Frigidaires to Asia for recycling? I say turn them directly into Fords and Chevys here at home. GMC is already offering a carbon fiber pickup box, why not just make the whole thing out of carbon fiber? We won WWII without any frickin rusty Chinese steel, we can win our trade wars without it also – time to man up and make American great again!!!
Speaking of maga and steel, I watched The Deer Hunter the other night. If that’s the America you want back again you’re welcome to it.
@pbx: I’m from that part of the country… It was great! (/sarc)
The air pollution from the blast and coke furnaces, the water and heat pollution from river water being used as coolant for the process, heavy metals in the air, water and land (hey, all of that ash and slag has to go *somewhere*). Some of the local governments used to use slag from the blast furnace instead of salt or sand when it snowed. I miss the sound of air being injected into the cauldron. It was a constant thunderstorm. (/sarc x 2)
I can remember taking trips in to Pittsburgh and as you descended the hills going into the city on I-79, the smell was just… incredible. When the rubber mills were still going Akron, Ohio smelled better. (no /sarc)
It was a great time to be alive. (/sarc x 3)
Where’s the outrage over the amount of jobs Trump Inc has outsourced to China or 4 decades of Republican policies mowing down trade barriers with Asia?
Irony writ large.
BTW, how’s the growth of the coal industry coming along? LOL
I’ll be making America great again by voting his orange butt out of office in ’20.
“4 decades of Republican policies” – 4 decades includes Republicans like Carter, Clinton and Obama – between them they served half of those 4 decades and each had some Congresses (as defined by the 2 year election cycle) who would go along with Presidential leadership on this issue. Why did nothing happen in those 2 decades?
The short answer is that they were no better (or better understood the volatility of the global market).
That said, to say that Trump somehow different in this respect is just not true.
He certainly knows his audience well and talks a big game though.
Given that only one of the Presidents from Carter forward could demonstrably read a balance sheet (plus W), it isn’t completely surprising that the others didn’t see the slow long-term corrosive effect on the health of the economy and US workers. It was noble to be the engine pulling the global economy forward and we benefited as well, but the engine is running low on fuel….
It is time for at least the threat of the Rule Golden – do unto others as they do unto you.
chuckrs, I’m of the philosophy, “Do Unto Others BEFORE They Do Unto You.”
Works better.
General Mattis has the philosophy, “For Everyone You Meet Have A Plan How To Kill Them.”
Semper Fi!
Hoorah.
Here’s your boy making America great…
https://www.washingtonpost.com/news/fact-checker/wp/2016/08/26/how-many-trump-products-were-made-overseas-heres-the-complete-list/?utm_term=.3731a6580fc2
http://fortune.com/2017/03/29/president-trump-job-claims-fact-check/
stingray65:
Yes we did….We had big steel mills then ….now we don’t
We have ore we don’t have the mills to produce large quantities of steel now.
If we ever have to go to war :=( We can’t build war materials
xtoyota:
Actually US steel production is higher today than during WWII when we were making all those tanks, ships, and other war goods. Total US steel production during the war was 334 million metric tons (about 67 per year), while recent US production has been about 80 million metric tons per year. The biggest difference is it just doesn’t take so many people or such big mills to produce steel today.
In 40 yrs we haven’t had this much discussion about int. trade, let alone a leader with sack enough to actually do something about it.
Also, Trump is pulling swaths of Union Democrats to the Republican ticket in November.
When it comes to America’s leaders, a “big sack” can be dangerous to America if there’s no big brains guiding it.
But then again, we’re talking about someone who cares more about a third world military parade than our public education system, so there you go…
“Also, Trump is pulling swaths of Union Democrats to the Republican ticket in November.”
I’d say that this is the main reason why we are hearing this kind of rhetoric.
If the economy tanks because of a trade war then President #NoCollusion and his followers can blame the deep state and those foreigners for USA’s woes. Either way, it is a win/win for him.
The auto industry is the benefactor of Chinese subsidies applied to steel, aluminum, and other materials. The cost of Chinese subsidies is paid by the American metals industries and their employees. As Wilbur Ross says, the price impact will be minimal on individual automobiles and other consumer goods.
I don’t prefer tariffs, but this “free trade” dog and pony show is getting old. Only the US is required to practice free trade. Everyone else gets to be protectionists and mercantilists. Wall Street wins. Main Street disappears. This was a suitable arrangement in the late-90s, when the US economy was overheating. It’s not acceptable now.
I do believe there are a few countries with more liberal economies, they also trade.
@TW5, that is not correct. There are great many nations that allow American goods and services into their nations without tariffs. Plus they allow American ownership of their natural resources.
Nope. There are anti-dumping tariffs on Chinese steel and aluminium up to 90% already.
@TW5 – really? I’d like to see the facts that you have based your comments upon.
“In 2016, the Obama administration imposed duties on some Chinese steel imports by more than 500 percent, causing Chinese imports to the U.S. to drop by almost two-thirds.”
China only makes up 2% of steel imported into the USA. Chinese business says tariffs will have virtually no impact on them since they don’t rely upon USA markets.
Some experts have done preliminary calculations and estimate that tariffs on steel and aluminum will drop GM and Ford’s profits by 1 billion dollars each.
Where are the complaints about China’s 25 % tariffs on foreign-built automobiles?
One stitch at a time.
Let’s deal with the NAFTA inequities first. Then we can turn our attention to other trade imbalances.
Charity begins at home, that being NAFTA because it involves our neighbors.
Like the 25% US tariff on pick ups you mean ?
CAFE, the US will not need it!
YAWN. Another day, another political click bait article from an automotive website. Hey everyone, did you know Black Panther is the BEST FILM OF ALL TIME???!!!!
HA! Trumpito on TTAC is great entertainment.
This is why countries and their leaders are getting sick of Trump. Have read.
http://www.abc.net.au/news/2018-03-05/trump-said-australia-would-be-exempt-from-tariffs/9512612
Putin got his money’s worth by getting his orange poodle elected.