Michigan Business & Economy

Howes: Trump's "big border tax" could mean higher price tags at dealerships

Michigan Public | By Stateside Staff

Published January 5, 2017 at 5:04 PM EST

According to Daniel Howes, if automakers have to pay more in taxes and tariffs for building outside the U.S., the cost of vehicles could go up for American consumers.

Our conversation with Daniel Howes, Detroit News columnist and associate business editor

The U.S. auto industry came into the crosshairs of President-elect Donald Trump's Twitter feed this week. Trump aimed a Tweet straight at General Motors, grumbling about GM's building of the Chevy Cruze in Mexico.

General Motors is sending Mexican made model of Chevy Cruze to U.S. car dealers-tax free across border. Make in U.S.A.or pay big border tax!— Donald J. Trump (@realDonaldTrump) January 3, 2017

A day later, he gave a hat-tip to Ford.

Thank you to Ford for scrapping a new plant in Mexico and creating 700 new jobs in the U.S. This is just the beginning - much more to follow— Donald J. Trump (@realDonaldTrump) January 4, 2017

Detroit News business columnist Daniel Howes joined Stateside to break it all down.

This tough message being sent to the automakers is something that the public has been wanting to hear for a long time, according to Howes. However, just as he wrote in his recent column in the Detroit News, Trump's approach to strong-arming General Motors and Ford ignores the realities of a very globalized auto industry.

Howes points out that GM building its Buick Envision in China, and Fiat/Chrysler building its Jeep Renegade in Italy are just two examples of how automakers rely on foreign production. Not to mention several parts that are constructed in foreign countries and shipped to the U.S.

Howes is quick to point out that those who are celebrating Trump's approach to make automakers "Build America" aren't going to be happy when the price tags of those vehicles go up as a result of that "big border tax."

Listen to the full interview above to hear more about the political conflict taxes on the auto industry could create in the United States and what the Trump administration can do to help bring jobs and production back to the U.S.

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