LarsenTariffs0227

U.S. Rep. Rick Larsen, right, talks with owner of Marysville Toyota Jim Colon on Feb. 23 about potential tariffs that could be impacting the country's car market soon.

 

U.S. Rep. Rick Larsen came to Marysville Toyota on Feb. 23 to talk about the impact on the automobile industry by potential and current tariffs.

"Right now, it's the threat of Section 232 tariffs [steel and aluminum tariffs] on imports," that most impact car production and sales, said Larsen.

There is also the possibility of new tariffs on imported foreign cars or auto parts, which Pres. Donald Trump talked about in recent Europe trade talks this month.

Toyota and many other car manufacturers build their vehicles in the U.S.

"Toyota is a major manufacturer in the U.S.," said Jim Colon, owner of Marysville Toyota.

"Everybody's here and they're building cars, and now we're going to add a tax on those parts?" he said.

Those added costs would likely be pushed down to the consumer.

"Right now the cost of tariffs has largely been absorbed into prices and people don't really see it," said Larsen.

When the difference is less than a dollar on a small product, the consumer might not notice, Larsen said, but on cars where a tariff could be thousands of dollars, the consumer is more likely to notice.

"The end user will see if it's on cars," said Larsen.

Colon agreed that is the most likely case.

"Our concern is clearly focused on what would happen and the impact on consumers. It would be an added tax we think consumers would be reluctant to pay and we think it's very unnecessary at this time," he said.

Those price increases would likely be bad for employees and business owners in the automotive industry.

"If those prices on our cars change 20 percent or 30 percent, well, we'll be looking for work. That's not going to be a good thing for us," said Colon.

"These 57 people that work here make good wages, and if prices increase that number will go down," said Larsen.

Toyota officials said they would prefer a more open international trade market.

"From our stance it's just about making it free and fair trade between Japan and us, or whoever it happens to be," said Brian Hebert, district sales manager with Toyota.

Larsen was recently in Brussels for the trade talks with NATO and met with representatives from other countries, who are unhappy with Pres. Trump's demands in international trade.

"They said 'look, if he [Trump] slaps these tariffs on with 20 percent or 30 percent, we're done, we're barely tolerating being lectured," said Larsen.

"I think right now, as friends and allies, they don't want to turn a blind eye, but they don't like being lectured to by the U.S. and by our current president, over burden sharing," he said.

Larsen said those countries may explore other options if more tariffs are enacted, such as exporting to the U.S. less and other countries more.

"They're not going to tolerate jobs being lost over there either," he said.

Pres. Trump has used an obscure 1962 law regarding national security to implement some of his tariffs.

"From my perspective, it's not even good policy in the U.S. It's one thing to say it’s not going to be good for our friends and allies, but it's bad policy to utilize that 1962 law and invoking national security," said Larsen.

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