The Trump administration’s latest trade deal with Britain unfairly penalizes US automakers that have partnered with Canada and Mexico, a trade group representing Detroit automakers said Thursday.
In a sharply-worded statement, the American Automotive Policy Council (AAPC) said the US-UK trade deal “hurts American automakers, suppliers, and auto workers,” according to the group’s president Matt Blunt.
The deal unveiled Thursday between US President Donald Trump and British Prime Minister Keir Starmer lowers the tariff on British vehicles to 10 percent from 27.5 percent on the first 100,000 cars shipped from Britain to the United States.
In contrast, AAPC members Ford, General Motors Company and Jeep-maker Stellantis now face import tariffs of 25 percent on autos assembled in Canada and Mexico. The Detroit companies organized their supply chains around the 2020 US-Mexico-Canada Agreement (USMCA), which Trump negotiated in his first term.
“We are disappointed that the administration prioritized the UK ahead of our North American partners,” Blunt said. “Under this deal, it will now be cheaper to import a UK vehicle with very little US content than a USMCA compliant vehicle from Mexico or Canada that is half American parts.”
Trump last week unveiled some steps to lessen the impact of tariffs on imported auto parts in moves applauded by GM and Ford.
The Trump administration will allow companies that assemble autos in the United States to deduct a fraction of the cost of imported parts for two years to give the industry enough time to relocate supply chains.
In another change, the administration said companies wouldn’t face a 25 percent levy on imported steel or aluminum in addition to a 25 percent levy for an imported vehicle.
But last weeks’ changes did not soften the 25 percent tariff on imported finished autos.
The Trump administration plans to negotiate separate agreements with Japan, South Korea and the European Union, all of which export finished autos to the United States.
“We hope this preferential access for UK vehicles over North American ones does not set a precedent for future negotiations with Asian and European competitors,” Blunt said.
