Trump Proposes Steel, Aluminum Tariffs

Trump Orders Steel, Aluminum Tariffs

President Donald Trump said he plans to impose a 25 percent tariff on steel and 10 percent tariff on aluminum in a session with steel and aluminum industry executives. 

U.S. steel imports and tariffs

President Donald Trump ordered a 25 percent tariff on steel and 10 percent tariff on aluminum in a session with steel and aluminum industry executives. 

Trump said the tariffs will be in place for an “indefinite” amount of time. While he is expected to sign the order next week, Trump did tell executives that the tariffs would apply to all countries.

“We’re going to build our steel industry back and we’re going to build our aluminum industry back,” Trump said at the session. “People have no idea how badly our country has been treated by other countries, by people representing us that didn’t have a clue… they should be ashamed of themselves because they’ve destroyed the steel industry, they’ve destroyed the aluminum industry, and other industries…”

In the wake of Trump’s announcement, the American International Automobile Dealers Association released a statement opposing the decision, saying that the move would be disastrous for the cost of U.S.-made automobiles and could ignite a trade war that would hurt American consumers.

According to the association, the key role that steel and aluminum play in the production of automobiles would substantially raise the sale price of new cars and trucks in the United States, and the costs of retaliatory tariffs would be passed onto American consumers.

“These proposed tariffs on steel and aluminum imports couldn’t come at a worse time,” said AIADA President and CEO Cody Lusk. “Auto sales have flattened in recent months, and manufacturers are not prepared to absorb a sharp increase in the cost to build cars and trucks in America. The burden of these tariffs, as always, will be passed on to the American consumer. Car shoppers looking for a deal will instead find that they are paying a new tax to transport themselves and their families.”

The AIADA says that steel and aluminum tariffs could directly counteract any benefits American manufacturers have seen from tax and regulatory reform, citing the analysis of 2002 steel tariffs that cost 200,000 jobs, including 30,000 in Michigan, Ohio, and Pennsylvania alone.

The United Steelworkers Association (USW), however, applauded the administration’s efforts for standing up for domestic businesses and workers.

“The steel and aluminum sectors have been under attack by predatory trade practices,” the USW said in a statement. “For the USW, the objective has always been to restore market-based economics that ensure that our domestic producers can achieve a fair return as they invest in facilities, equipment and people, and contribute to the strength of our nation. The objective should also be to reduce the negative impact of steel and aluminum imports that have decimated production in the United States. The tariff levels the President announced will help to achieve that objective.”

Earlier in February, the U.S. Department of Commerce recommended that President Donald Trump impose tariffs and quotas on imported steel from China and other countries.

With the U.S. being the world’s largest importer of steel, the department recommended a global tariff of at least 24% on all steel imports from all countries. It also suggested that a 53% tariff be placed on all steel imports from Brazil, China, Costa Rica, Egypt, India, Malaysia, Republic of Korea, Russia, South Africa, Thailand, Turkey and Vietnam.

In its report, the department remedies including the tariffs would increase domestic steel production from its present 73% of capacity to approximately an 80% operating rate, the minimum rate needed for the long-term viability of the industry. The tariffs and quotas would be in addition to any duties already in place.

U.S. Tire Manufacturers Association (USTMA) President and CEO Anne Forristall Luke expressed concern about the department’s recommendation in early January saying the tariffs could “have unintended consequences for domestic tire manufacturers and the workers and industries they support.”

“High-quality steel is critical for tire production. Domestic steel mills use a production process that is unable to produce the steel necessary to make tires,” she said. “USTMA members must retain the capability to import the specialized steel products that are vital to making tires in the United States. A disruption in tire manufacturing in the U.S. would harm our economy and threaten national security, since the U.S. military relies on the tire industry to provide high performing and durable tires to aid in our national defense. We strongly urge the Administration to exempt the tire industry from any such tariffs and quotas, or at the least commit to establishing a process for timely review of exemption applications.”

This story will be updated. 

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