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ND auto dealers: Tariffs could pose 'significant challenge'

Sen. John Hoeven, R-N.D., tells North Dakota auto dealers that the Trump administration is using the threat of tariffs to try to negotiate better trade deals, but does not want to impose tariffs. Patrick Springer / Forum News Service

FARGO — Sen. John Hoeven, R-N.D., briefed North Dakota auto dealers on federal efforts to resolve trade disputes during a meeting with The Automobile Dealers Association of North Dakota on Monday, Sept. 10.

Those dealers hope U.S. negotiations will achieve fair trade without having to impose tariffs on imported cars and trucks.

The U.S. is in the midst of talks to renegotiate the North American Free Trade Agreement, commonly called NAFTA, and Trump has threatened to impose tariffs on cars from European Union nations. The unresolved trade disputes have created a sense of uncertainty as auto dealers await the outcome.

"Nobody knows what's going to happen on tariffs," said Dan Wilson, a Fargo auto dealer executive who serves on the board of the National Automobile Dealers Association. "NADA is neutral on that."

The national association doesn't want to see tariffs, but it is supporting the administration as it exerts pressure on trading partners to achieve more favorable trade, said Wilson, who is a partner, chief financial officer and vice president of Corwin Automotive Group.

"That's a huge issue for everyone in this room," Wilson told the group of auto dealers who gathered for Hoeven's briefing. Because of extensive global supply chains, no cars are made solely in America now, he said.

Hoeven told the auto dealers, who were meeting at the downtown Radisson, that the Trump administration is trying to level the playing field with other trading nations.

"There are abuses out there, there's no question about it, and China is the biggest abuser," Hoeven said, citing that country's flouting of copyright laws as an example. "Of course, it's tough in the short term."

Hoeven said he is optimistic that a deal to replace NAFTA can be struck this fall. "The negotiations are going very well with Mexico," he said. "There is pressure on Canada to come to the table."

To adjust to changing conditions, Trump wants trade deals that must be renegotiated every five years, Hoeven said.

Although new deals with Mexico and Canada are possible this fall, "China is a longer-term proposition," Hoeven said.

During questions and comments following Hoeven's talk, dealers said a 20-percent tariff on imported motor vehicles, if imposed, would pose a "significant challenge" to dealers because many parts for domestic autos are manufactured abroad.

"The auto industry has become globally integrated," one dealer representative told Hoeven. For his part, Hoeven said he understands such concerns and said the administration wants to apply strong pressure on foreign countries, but does not want to impose tariffs.

After Hoeven's talk, Christian Kostelecky, board chairman of the Automobile Dealers Association of North Dakota, said in an interview that he was reassured by the senator's comments. "It seems like there's a path" toward resolution, he said.

"Ultimately nobody likes tariffs," Wilson said in an interview. "Everybody wants fair trade. We wouldn't even venture to guess what a tariff could do."

There are 96 franchised auto and truck dealerships in North Dakota.

Patrick Springer

Patrick Springer first joined the reporting staff of The Forum in 1985. He can be reached by calling 701-241-5522. Have a comment to share about a story? Letters to the editor should include author’s name, address and phone number. Generally, letters should be no longer than 250 words. All letters are subject to editing. Send to letters@forumcomm.com

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