Automakers are bracing for President-elect Donald Trump to impose new tariffs on vehicles from Mexico and potentially from other countries and to reverse many existing pro-electric vehicle (EV) policies, industry associations and executives said.
Trump has said he plans to begin rescinding Environmental Protection Agency (EPA) and Transportation Department vehicle rules on his first day in office and is considering paring back or eliminating EV tax breaks and other incentives.
Those regulatory changes could give automakers more flexibility to build more profitable gas-powered SUVs and trucks but raise questions about the future of billions of dollars in EV battery and manufacturing spending.
The Zero Emission Transportation Association, which includes Tesla Inc, Rivian Automotive Inc, Lucid Group Inc and battery maker LG Electronics Inc said on Wednesday it was ready to work with Trump. The "next four years are critical to ensure these technologies are developed and deployed by American workers in American factories for generations", it added.
The American Trucking Associations on Wednesday called on Trump to replace the EPA's tighter tailpipe emissions with national emission standards that were "technologically achievable and account for the operational realities of our essential industry".
Trump plans to rescind California's ability to set its own vehicle emissions rules, as he did in 2019. President Joe Biden reinstated California's authority. Trump will also decide how to spend billions of dollars in EV charging grants.
Trump has repeatedly warned he will impose tariffs of 200% or more on vehicles imported from Mexico and could also impose them on Asian and European vehicles.
Trump wants to prevent Chinese auto imports but is open to Chinese automakers building vehicles in the US.
South Korea's trade minister said Wednesday that he expected companies from his country to invest more in the United States if Trump imposed higher tariffs.
Honda Motor Co Ltd Chief Operating Officer Shinji Aoyama said its production capacity in Mexico is about 200,000 vehicles annually, and 80% are exported to the US market.
If the US were to impose permanent tariffs on vehicles imported from Mexico, Aoyama said Honda would have to think about shifting production.
Toyota Motor Corporation builds Tacoma trucks at two plants in Mexico and sold more than 230,000 of the models in the US last year.
A person close to Toyota said Trump's steep tariffs on Mexican imports could prompt the automaker to move production of a vehicle like the Tacoma to San Antonio, Texas. A Toyota spokesperson declined to comment.
Reuters
