The automakers are leery about the TPP -- who can blame them?

Posted by LDonia on 10/24/2013

If you’re a regular reader of ManufactureThis, no doubt you have read much about the Trans Pacific-Partnership (TPP). The TPP, at this point, is essentially the trade world’s version of a ‘will they/won’t they’ rom com. Every week it seems new details emerge about what one side wants, and what the other side is -- or is not -- willing to give.

Alas, this week is no different.

The TPP news du jour: concerns in the auto industry.

According to William Mauldin at the Wall Street Journal:

Tokyo has long objected to U.S. automobile tariffs, including a high duty on Japanese trucks, and the U.S. says Japan’s car market isn’t fully open to foreign cars. The two countries are discussing a plan to phase out the U.S. tariffs on Japanese autos very slowly as a part of the TPP, and Japan has moved to more than double the number of U.S. vehicles that can be shipped under a preferential program.

It’s totally understandable that the auto industry would be raising these concerns … after all, it’s been burned before. So many times, in fact, the Alliance for American Manufacturing (AAM) has dedicated a section of its website to this very issue.

Because it’s timely, let’s just take this opportunity to reiterate the following: More than 400,000 jobs in the U.S. auto supply chain have been lost since 2000. Why/How? China’s violation of World Trade Organization rules.

The damage that trade with China did to the U.S. auto industry is still felt around this country. And another bad trade deal with another competitor could completely demolish the U.S. auto sector, a result that is absolutely antithetical to what the American economy needs.

We hope the Trade Representative’s office will take into account the effects such a deal would have on the manufacturing workers of America, and not just the CEOs. A good start would be listening to the words of elected officials. As Mauldin mentions:

Besides the traditional trade issues, some U.S. lawmakers say Japan’s monetary policy is targeting a weaker yen, a shift that makes Japanese cars more competitive in the U.S. and hurts Detroit along the way. The lawmakers want the TPP to address the issue of currency manipulation and have discussed their concerns with U.S. Trade Representative Michael Froman and Treasury Secretary Jacob Lew.

AAM co-signs on the sentiment above. Stay tuned, America.

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