EU countries approved a raft of tariffs on Thursday (14 June) targeting U.S. goods including whiskey and motorcycles in retaliation against painful duties imposed by President Donald Trump on European metals. Therefore, Moog will be unable to avoid this substantial cost increase because of the tariffs. And for us to initiate a trade war against them is not good for American companies that depend on exports.
"Alternatively, if prices are not increased and we opt to bear the burden of tariffs or plant moves, this could lead to less investment, fewer jobs, and lower wages for our employees", the automaker warned.
"Retaliatory tariffs imposed by other countries on US exports will make American-made goods more expensive, resulting in lost sales and ultimately lost jobs here at home". "But we believe that a potential 25 per cent tariff on imported vehicles and auto parts will, in fact, have the opposite affect".
Last week, General Motors (NYSE:GM) said that the tariffs, if approved, could drive up the process of individual vehicles and costs would need to be borne either by consumers or the company, the latter meaning job cuts. The EU has imposed retaliatory tariffs on goods worth €2.8 billion ($3.27 billion), primarily on US-built motorcycles. Consider American soybean farmers, who send about 60 percent of their exports to China. As with steel and aluminum, "national security" would be the justification.
The president announced 25 percent import tariffs on hundreds of Chinese products to pressure the country to alter its practices. He has also stepped up attacks on the European Union via Twitter and at his public rallies.
According to the organization, half of all USA manufacturing jobs depend on exports, and 1 in 3 acres on US farms produce crops for the worldwide market. "There is much to be done that will benefit both the United States and Mexico!"
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Trump has defended the policies, arguing last month the tariffs are necessary because the U.S.is being "ripped off by other countries".
Trump s Republicans are fighting to retain control of Congress in November midterm elections.
The White House has already imposed tariffs on European Union steel and aluminium and faced reprisals in the form of extra charges on a range of goods, including US-made motorcycles, jeans and even playing cards.
The European Commission has not confirmed the plans, saying that President Jean-Claude Juncker "has not yet decided what to discuss at the meeting with President Trump", the FT said. This would only be aggravated by the likely counter-measures the 28-nation bloc and other trading partners might take.
She said the European Union can not lift its auto tariffs for the U.S. or it would have to do so for the rest of the world, and "there's no way" European Union member countries would agree to that.
The EU also points out that European vehicle manufacturers directly employ 120,000 Americans, with 420,000 indirectly employed through suppliers and auto dealerships.