Automakers ‘nowhere out of the woods’ from potentially higher taxes

Global Automakers CEO John Bozzella says that President Trump has helped the auto industry by reducing taxes, but higher manufacturing costs due to tariffs might hurt the industry.

If President Trump moves forward with 25% tariffs on autos and car parts imported into the United States there could be some big consequences, according to the Association of Global Automakers.

While reducing and reforming corporate taxes and scaling back regulations has been a “winner” for the U.S. auto industry, there are concerns that “we might be offsetting those wins with higher cost of manufacturing and higher prices that come with tariffs,” John Bozzella, the CEO of the trade group, told FOX Business’ Connell McShane on “Cavuto: Coast-to-Coast” on Monday.

During a joint press conference last week, Trump struck a deal with European Commission President Jean-Claude Juncker to hold off on proposed auto tariffs while the two sides work toward resolving their dispute.

While Trump has made “good progress,” Bozzella said, “we are nowhere out of the woods with the potential for high taxes on autos.”

“What we’ve done with auto tariffs between the EU and the U.S. is we just hit the pause button depending on how conversations go,” he added.

Meanwhile, Canada, the European Union, Japan, Mexico and South Korea are expected to meet in Geneva next week to form a cohesive response to Trump’s tariff threats.

Bozzella said the auto industry is already seeing the impact of steel tariffs domestically and forging ahead with 25% would be “devastating.”