A coalition of U.S. auto industry associations has urged President Trump to reconsider imposing a 25% tariff on imported auto parts. They argue such tariffs would disrupt the automotive supply chain globally, leading to increased vehicle prices and lower dealership sales. The letter highlights that many auto suppliers lack the capital to withstand sudden tariff-induced disruptions, which could cause production halts and layoffs in addition to increasing costs associated with vehicle maintenance and repairs. Major automakers like General Motors and Toyota have expressed concerns through their trade organizations.
"Tariffs on auto parts will scramble the global automotive supply chain and set off a domino effect that will lead to higher auto prices for consumers, lower sales at dealerships and will make servicing and repairing vehicles both more expensive and less predictable."
"Most auto suppliers are not capitalized for an abrupt tariff induced disruption. Many are already in distress and will face production stoppages, layoffs and bankruptcy, noting 'it only takes the failure of one supplier to lead to a shutdown of an automaker's production line.'"
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