Trump says he may soon increase car tariffs to push more US production
US President Donald Trump on Thursday warned he may soon hike car tariffs, arguing that could prod carmakers to speed US investments.
"I might go up with that tariff in the not too distant future," Trump said at a White House event.
"The higher you go, the more likely it is they build a plant here."
Carmakers have been pressing the White House to reduce the 25% tariffs Trump imposed on cars. The Detroit Three carmakers have criticised a deal that would cut tariffs on British car imports but not on Canada or Mexico production.
Trump cited recent investment announcements, including GM saying this week it plans to invest $4bn (R71,882,393,200) in three US plants and move some SUV production from Mexico. He also noted a $21bn (R377,382,600,000) Hyundai investment announced in March, including a new US steel plant.
"They wouldn't have invested 10c if we didn't have tariffs, including for manufacturing American steel, which is doing great," Trump said.
Mexico said last month cars assembled in Mexico and exported to the US will face an average tariff of 15%, not 25%, because Washington is giving carmakers reductions for the value of US content.
Carmakers are facing increasing cost pressures stemming from tariffs. In recent weeks, Ford Motor and Subaru of America have hiked prices on some models due to higher costs from Trump's tariffs. In May, Ford estimated tariffs would cost it about $1.5bn (R26,939,413,200) in adjusted earnings.
GM said last month it had a tariff exposure of between $4bn (R71,882,393,200) and $5bn, including about $2bn (R35,942,920,000) on the more affordable vehicles GM imports from South Korea, where it makes entry-level Chevrolet and Buick models.
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