Auto industry starts counting cost of Trump's threatened Mexico tariffs

 Auto industry starts counting cost of Trumps threatened Mexico tariffs

By Nick Carey

DETROIT (Reuters) - Major automakers are assessing the cost of tariffs that U.S. President Donald Trump has threatened for Mexican imports, both to themselves and their supply chain, with Toyota Motor Corp telling U.S. dealers the duties could cost its major suppliers up to $1 billion.

Trump has said he will apply tariffs of 5% on Mexican goods on June 10 if Mexico does not halt the flow of illegal immigration, largely from Central America, across the U.S.-Mexican border. Those tariffs would gradually rise to 25% by Oct. 1 if Mexico does not satisfy with Trump’s demands.

In an email seen by Reuters, Toyota said Trump's tariffs could potentially cost the automaker's major suppliers between $215 million and $1.07 billion, according to an email.

The email, dated June 3, from Toyota's North American sales chief, Bob Carter, also told dealers that 65% of the Tacoma midsize pickup trucks the Japanese automaker plans to sell in the U.S. market in 2019 will be imported from its plant in Baja, Mexico.

On Tuesday Kevin Clark, chief executive at auto supplier Aptiv PLC told investors at a conference in Boston that a 5% tariff would cost it around $17 million per month.

Speaking to reporters on the sidelines of a conference in Montreal on Tuesday, Steve Kiefer, senior vice president, global purchasing and supply chain at General Motors Co, declined to discuss how much tariffs could cost but said "the single biggest problem we have is the uncertainty with tariffs."

"Right now, we’re asking all of our suppliers to be calm and not do anything drastic," Kiefer said.

(Reporting by Nick Carey; additional reporting by Allison Lampert in Montreal and Sanjan Shivdas in Bangalore; editing by Steve Orlofsky)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Your guide to the latest cricket World Cup stories, analysis, reports, opinions, live updates and scores on https://www.firstpost.com/firstcricket/series/icc-cricket-world-cup-2019.html. Follow us on Twitter and Instagram or like our Facebook page for updates throughout the ongoing event in England and Wales.

Updated Date: Jun 05, 2019 00:06:40 IST