Love Tariffs? Prepare to Cough up an Extra $1,800 for a Camry, Toyota Warns

Steph Willems
by Steph Willems

Toyota’s not going silently into a potential future where tariffs are as prevalent as man buns and tattoos in a brewpub. In its submission to the U.S. Commerce Department, Toyota wants the government to know it’s a standout business, and that a tariff on imported automobiles and auto parts would backfire.

Even for vehicles built in the U.S., American buyers would face a steep price hike, Toyota claims. Care to fork over an additional $1,800 for a Kentucky-built Camry? Meanwhile, a Canadian supplier association representative warns of “carmageddon” if the tariffs come to pass.

Toyota prepared the submission for hearings stemming from the Commerce Department’s investigation into whether auto imports represent a security threat to the United States (under section 232 of the Trade Expansion Act).

Hearing begin next month, with the investigation expected to wrap up in late July or August. Here’s Toyota’s statement in full:

A hundred and thirty-seven thousand Americans support their families working for Toyota, and Toyota and Lexus dealerships. They are not a national security threat. Indeed, Toyota operates 10 manufacturing plants in the U.S. We are an exemplar of the manufacturing might of America. A 25% tariff on automotive imports, which is just a tax on consumers, would increase the cost of every vehicle sold in the country. Even the Toyota Camry, the best-selling car in America, made in Georgetown, Kentucky, would face $1,800 in increased costs. We believe the only plausible outcome of this investigation is to reject the notion that automotive imports threaten national security.

Should NAFTA talks break down and the Trump administration follow through with the president’s threat to levy a 25 percent import tariff on foreign-built autos, expect larger price increases on other Toyota models — most significantly the Ontario-built RAV4, America’s best-selling non-pickup vehicle.

Toyota is just one of many companies speaking out against the proposed import duty. Automobile manufacturer associations, suppliers, and union leaders have piped up in opposition to the threats. North of the border, it’s getting pretty loud.

“A 25 per cent tariff on parts and cars would cause what we like to call ‘carmageddon’,” Flavio Volpe, president of the Automotive Parts Manufacturers’ Association, told a Canadian House of Commons committee on Tuesday.

“The industry operates on single-digit margins and it would grind to an immediate halt with a 25 per cent increase in price.”

The committee’s main focus was on existing steel and aluminum tariffs, but the spectre of import duties on Canadian-built vehicles and auto parts loomed large. According to a Financial Post report, it isn’t just manufacturers losing sleep over the threats.

“Let me say this plainly. Steel and aluminum tariffs, while significant and negative for the retail automotive market, are minimum compared to the tsunami-like economic downturn that will occur should we be subjected to a 25 percent tariff or even lose NAFTA,” John White, chief executive officer of the Canadian Automobile Dealers Association, told the committee.

“In our view, the effects of the 2008-2009 economic situation would pale in comparison to what our members and the Canadian economy would face if we end up with a 25 per cent tariff on our cars.”

Across the river from America’s automotive heart, autoworkers and suppliers in Windsor, Ontario aren’t resting easy. Some 38,000 jobs are tied to the auto industry in that city, which builds engines for Ford and minivans for Fiat Chrysler.

“If they impose tariffs on those cars, companies will probably come after the workers to make up for the loss in profit and that’s the fear on the floor right now,” said Steve Morgan, an autoworker at FCA’s Windsor Assembly Plant, in an interview with CBC.

Unifor, a union representing Detroit Three autoworkers in Canada, has scheduled trade-related town halls in four cities.

[Image: Toyota, Fiat Chrysler Automobiles]

Steph Willems
Steph Willems

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  • Jimmy2x Jimmy2x on Jun 29, 2018

    FWIW, I am truly appalled by the click-bait nature of this article and more so by many of the replies. Have mostly lurked here going back to the Farago days and have found it to be both informative and often amusing. There are lots of places to go to for endless political ranting. I assume that we are all adults here. Some of you should be ashamed of yourselves.

    • See 2 previous
    • Big Al from Oz Big Al from Oz on Jun 29, 2018

      @jimmy2x jimmy, Politics is what influences what we drive in Australia, America, everywhere. A good example was the old East Germany. Yhey had car/s but the lack of freedom reduced options. Cost for us in wealthy nations affects our options. Even road infrastructure. I obviously like the business side of the auto industry and I even like all different vehicles. But the auto industry gives the car people their cars. So industry "talk" is good and interesting. For me. Have a nice day.

  • DougD DougD on Jun 29, 2018

    If you think that the US has only been lying around getting taken advantage of for the last 20 years we've got some softwood lumber we'd like to sell you. And some NFB documentaties for that matter. Don't forget to compare and contrast your news sources folks, and remember who is making billions by keeping you outraged. And yeah, the Drumpf thing derails your arguement right off the bat. I'm going with Laura Bush, who when everyone was calling W an idiot said something about people being decent and respecting the office. Which I think everyone should do, including the President.

  • MaintenanceCosts It's not a Benz or a Jag / it's a 5-0 with a rag /And I don't wanna brag / but I could never be stag
  • 3-On-The-Tree Son has a 2016 Mustang GT 5.0 and I have a 2009 C6 Corvette LS3 6spd. And on paper they are pretty close.
  • 3-On-The-Tree Same as the Land Cruiser, emissions. I have a 1985 FJ60 Land Cruiser and it’s a beast off-roading.
  • CanadaCraig I would like for this anniversary special to be a bare-bones Plain-Jane model offered in Dynasty Green and Vintage Burgundy.
  • ToolGuy Ford is good at drifting all right... 😉
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