Traders livid over foreign risk probe
Two automotive trade groups on Friday raised “significant concerns” over the US government’s request for confidential business information as it probes if automotive imports pose a national security risk, a letter seen by Reuters shows.
The US department of commerce survey demands sweeping details on operations of major US and foreign car makers, including planned changes to US facilities, revenue for specific classes of products and use of car parts. Companies that do not comply could face fines or criminal charges.
The department opened an investigation in May to see if imported cars and parts pose a national security risk.
This drew sharp criticism from car makers, foreign governments, dealers, parts suppliers and others who warned that proposed tariffs on imported cars and parts could hike vehicle costs, hurting motor sales and industry jobs.
Car makers, many of which face Monday deadlines to comply with the survey, said there was no evidence car imports posed a national security risk. The Alliance of Automobile Manufacturers, one of the two groups that sent the letter on Friday, said in July tariffs of 25% on imported cars and parts would raise the price of US vehicles by $83bn annually and cost hundreds of thousands of jobs.
Administration officials and congressional aides have said the probe was partly designed to win concessions during talks to renegotiate the North American Free Trade Agreement with Canada and Mexico.
The car trade groups, which represent General Motors, Volkswagen, Toyota, Honda, Daimler and other major car makers, warned in the letter that the companies had “grave concerns” that releasing confidential information would have a “seriously adverse impact” and questioned whether the US government would ensure the information was kept secret.
The car makers challenged the department’s assertion that US President Donald Trump could opt to release some information submitted by them under the Defense Production Act adopted in 1950.
They also questioned the government’s precautions in keeping data confidential and said the survey suffered from “several procedural defects.”
Officials dismissed the car makers’ concerns on Friday, saying the department “routinely requests … accordingly, safeguards firms’ confidential data in both its trade cases and as part of its industry surveys”.
The survey wants the average value of US car part content for passenger cars, trucks, sport utility vehicles and vans. It demands car makers disclose gross profits for US operations and asks them to rate suppliers and disclose “how important price, tariffs, product availability, and performance/ quality are in deciding to use this supplier”.
It also asks whether vehicle imports have resulted in “any negative effects”.