Canada vows to retaliate if US imposes auto tariffs

Canada vows to retaliate if US imposes auto tariffs
Canada vows to retaliate if US imposes auto tariffs

Canada warned at a hearing Thursday in Washington that should the United States impose a 25 percent tariff on imported autos, it will strike back.

The U.S. Commerce Department is investigating whether the tariffs are necessary based on the theory that the imports pose a national security risk.

But for several hours, one after another, U.S. industry leaders and vehicle manufacturers said such a move would cause serious economic damage and begged the Trump administration to discard the tariff idea.

Numerous experts have warned that the auto and auto parts industries are so integrated in Canada and the U.S. that tariffs would result in driving up the cost of vehicles, thereby lowering demand among consumers and lead to large layoffs in both countries.

Canada’s envoy to Washington, Kirsten Hillman, testified that the proposal is a bad one for all concerned.

“Maintaining open trade in autos and auto parts between our countries is crucial to the economic well-being of our companies, our communities and our workers, which, in turn, supports our collective security,” Hillman said. “We urge you to reflect on these matters as you prepare your recommendations.”

She also called the rationale for slapping on tariffs specious at best.

“In this investigation, you are being asked to examine a specific industrial sector: automobiles and auto parts,” Hillman said.

“Not tanks. Not battleships. Civilian passenger vehicles and parts.

“So where’s the nexus between civilian vehicles and national security? There is none, and there’s no basis for finding one.”

Another warning was issued Thursday. As the commerce hearing presided over by U.S. Commerce Secretary Wilbur Ross listened to testimony, the European Union announced it would retaliate against the U.S. if the tariff proposal was adopted.

In all, 45 witnesses testified, and all but one criticized the tariffs idea. Jennifer Kelly of the United Automobile Workers union said years of relocating investment of auto jobs to lower wage countries like Mexico have damaged U.S. security.

Ross said at the beginning of the hearings that “it’s clearly too early to say” if the auto import tariffs would be recommended.