Pub. 9 2019 Issue 1

18 AUTOMOBILE DEALER NEWS ILLINOIS www.illinoisdealers.com A ll new cars sold in the United States will cost more — to build and probably to buy — if the Trump administra- tion imposes an auto tariff. That's because every car sold in America is at least partly imported. The Commerce Department is considering tariffs on cars assembled at foreign plants and on foreign-made auto parts. Every car assembled in the United States contains a significant percentage of foreign parts, according to government data. "There are no purely American vehicles," saidMichelle Krebs, senior analyst at AutoTrader. "These are global automakers who use global sources for all types of parts." Automakers are already warning that tariffs would raise their costs, in some cases by thousands of dollars per car. General Motors said last week that it could be forced to cut jobs. US regulators track how "domestic" every car is by measuring the percentage of each vehicle's parts and manufacturing that comes from either the United States or Canada. According to that measure, the two most "American" cars are both Hondas — the Odyssey minivan and Ridgeline pickup. Three-quarters of each vehicle's components are made in the United States or Canada. The Honda Civic, AcuraMDX, Acura TLX and theMercedes C-class source 70% from the United States and Canada. The highest-ranked car made by a Detroit automaker is the Chevrolet Corvette, which placed seventh. About two-thirds of its parts and manufacturing are from the United States or Canada. The only automaker that builds all its American cars at a US plant is Tesla (TSLA). But even Tesla imports roughly half the parts it uses. All major automakers have plants inMexico where they build some cars for the US market, so they would all have to pay a tariff on imported completed vehicles. But tariffs on parts would nearly double their estimated import cost: Tariffs on parts would cost automakers $35 billion, on top of $48 billion in tariffs on imported cars that are assembled outside the United States, according to the American Automotive Every US-Made Car Is An Import. That's Bad News for Automakers BY CHRIS ISIDORE