General Motors warns new wave of tariffs could force U.S. job cuts

General Motors on Friday warned that another wave of tariffs being considered by U.S. President Donald Trump could force the company to scale back its business and cost American jobs.

In comments submitted to the Commerce Department, the automaker said that the tariffs, if approved, could drive individual vehicle prices up thousands of dollars, stifling demand. Such costs would need to be borne either by consumers or the company.

Last month, President Trump ordered an investigation into whether imported cars and automotive components could pose enough of a national security risk to warrant tariffs of as much as 25 percent. If he goes ahead, it would intensify a global trade war that has engulfed allies and adversaries. In recent months, the administration has imposed tariffs on imported steel and aluminum, along with measures targeted at China.

Carmakers, in particular, have been caught in the middle of the trade fight. They rely heavily on metals to build their cars, including parts from overseas. The president’s threat to pull out of the North American Free Trade Agreement could also hurt the industry supply chain.

Several other automakers and manufacturing organizations, including the National Association of Manufacturers, BMW and Volvo, have also submitted comments on the tariffs under consideration for foreign automakers and part suppliers.

“Increased import tariffs could lead to a smaller G.M., a reduced presence at home and abroad for this iconic American company, and risk less — not more — U.S. jobs,” General Motors wrote in its comment.

The tariffs would result in “broad-brush trade barriers that increase our global costs, remove a key means of competing with manufacturers in lower-wage countries, and promote a trade environment in which we could be retaliated against in other markets,” the company said.

General Motors pointed to other potential consequences, including “less investment, fewer jobs and lower wages” for its employees.

“The carry-on effect of less investment and a smaller work force could delay breakthrough technologies and threaten U.S. leadership in the next generation of automotive technology,” the company wrote.

A G.M. spokeswoman, Dayna Hart, said that the company had no contingency plans calling for job cuts, but that it was “something that could happen.”

“We are still assessing the impact,” she added.

General Motors wrote in its comment that it has 47 manufacturing facilities, 25 service part facilities and 110,000 employees in the United States, where it conducts most of its research and development, design, engineering and other work.

Source: CNBC