Trump Officially Imposes Steel and Aluminum Tariffs

Trump Officially Imposes Steel and Aluminum Tariffs

President Donald Trump officially imposed a 25% tariff on steel and 10% tariff on aluminum during a press conference at the White House Thursday. 

U.S. steel imports and tariffs

President Donald Trump officially imposed a 25% tariff on steel and 10% tariff on aluminum during a press conference at the White House Thursday.

The tariffs, which Trump proposed last week, come just weeks after the U.S. Department of Commerce recommended that Trump impose tariffs and quotas on imported steel from China and other countries. But Trump said there will be a way for some countries to be excluded or negotiate on the tariffs, including Mexico and Canada that were excluded from the tariffs– for now. The tariffs go into effect in 15 days, Trump said.

“Our industries have been targeted for years and years by unfair trade practices,” he said at his press conference Thursday. “Now we’re finally taking action to correct this long overdue problem… The actions taken today were not a matter of choice, they’re a matter of national security.”

In a press conference where he was surrounded by U.S. steel and aluminum plant workers and executives, Trump touted the tariffs as a way for the U.S. to protect its workers. But he also said his administration would be open to modifying or removing tariffs on individual nations as long as they don’t threaten U.S. national security.

For example, he said the U.S. is currently in negotiations with China and that he would like to make a deal on the North American Free Trade Agreement (NAFTA) with Mexico and Canada to hold off on imposing tariffs on them while still making the agreement fair and beneficial for U.S. workers. He also mentioned that military aid the U.S. gives to certain countries will factor into the equation during tariff negotiations.

“We lose $800 million a year on trade,” Trump said at the press conference. ” But it has to change. “American companies have not been treated fairly.”

Towards the end of his speech, Trump floated the idea of eventually creating a reciprocal tax program with countries, saying “if they charge us, we’ll be at the same numbers. They charge us 50% (tariff), we charge them 50. Now we charge them nothing.” He also promised flexibility on the tariffs, saying “we just want fairness” when it comes to trade.

While some applauded Trump’s order, others dismissed it as unfair to their industries. The U.S. Tire Manufacturers Association sent a letter to Trump signed by the presidents of the 10 largest tiremakers in the U.S. that urged him to rethink the tariffs, citing “significant, negative impacts to U.S. manufacturers with cascading detriments to U.S. commerce and the U.S. economy.” The letter requests that the tire industry be exempt from any tariffs on steel imports.

“Our mobile society depends on tires, and our tires depend on specialized steel. Domestic steel producers simply do not have the ability to produce the type of steel wire rod needed to support the $27 billion U.S. tire manufacturing industry, which is why virtually all of such steel wire rod is sourced from foreign suppliers,” said Anne Forristall Luke, USTMA president and CEO. “To levy a 25 percent tariff on steel imports would cause incredible harm to the growing U.S. tire manufacturing industry and the jobs of hundreds of thousands of hard-working Americans who work every day to keep the American economy and military on the road.”

Bill Hanvey, president and CEO of the Auto Care Association, opposed the tariffs asking for an exemption for qualified U.S. companies “to alleviate the harm that will be caused by the imposition of this tariff.”

“Based on the fact that there are few parts necessary for the upkeep of a vehicle that do not contain significant amounts of steel and aluminum, this action will have a significant negative impact throughout the supply chain, including many small medium and small businesses and their employees that comprise the auto care industry,” Hanvey said. “While we are grateful that our trading partners, Canada and Mexico, are currently exempt, it is our view that these tariffs will quickly become a tax on the repair and maintenance of vehicles, a tax that will ultimately be paid for in higher repair prices by the American car owner.”

With both aluminum and steel used in the production of cars and trucks, The American International Automobile Dealers Association (AIADA) said the tariffs would cripple “an already flat auto sales market.”

“Tariffs are taxes, and the American taxpayer will pay the cost of a trade war,” said AIADA President and CEO Cody Lusk. “Even with limited exemptions, tariffs will raise the sale prices of new vehicles, turning off price-sensitive consumers and leading to a dip in both auto sales and auto-related jobs.”

Others in the steel and aluminum industry celebrated the tariffs as a win. U.S. Steel announced at the press conference that it would reopen a mill in Illinois and recall 500 workers immediately. Century Aluminum announced it will invest $100 million in  a Kentucky-based aluminum production plant that would produce 150,000 additional tons of aluminum and open up jobs for 300 workers.

Tom Conway, international vice president for the United Steelworkers union, said in a statement that Trump’s announcement has sent a positive charge through the steel industry with hope for revival.

“Our members have been on the front lines in the fight for fair trade,” Conway said in a statement. “They have sent tens of thousands of e-mails, walked the halls of Congress, placed calls and engaged in grassroots action to get help. Today, their call for action was answered. Now, we have to hope that the relief is quickly implemented and that it is sustained so that the investments in plants, equipment and people will occur.”

Earlier in February, the U.S. Department of Commerce under Secretary Wilbur Ross recommended in a report to place 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 certain countries such as China, Korea and Russia.  It concluded 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. On Thursday, Ross called the passing of the tariffs “critical to our economy.

“The President’s decision regarding the steel and aluminum… reports are the result of a long and well-thought-out process led by the Commerce Department,” Ross said. “Once again, President Trump is keeping his promises and standing up for American families, American businesses, and American workers.”

This story will be updated.

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