From NPR · · 1m 20s
Auto-parts makers are stuck in the U.S.-Canada trade war
The tariff fight between Washington and Ottawa lands hardest on the suppliers who build cars piece by piece.
In brief
The tariff fight between Washington and Ottawa lands hardest on the suppliers who build cars piece by piece. Auto parts are made across a border that both countries now tax, so suppliers absorb the trade war before drivers ever see it. Originally reported by NPR.
Trade war hits parts makers
The fight between the U.S. and Canada has stopped being an abstraction about tariffs. It has landed on the companies that make the components cars are built from.
One factory floor, two countries
North American carmaking treats the U.S. and Canada as a single production line. Components move back and forth across the border before a finished vehicle exists.
Costs stack per crossing
When duties apply every time a component crosses, the same part gets taxed more than once. Small suppliers feel that squeeze long before the big automakers do.
Planning becomes guesswork
Suppliers quote contracts months ahead of delivery. Rules that shift between quarters make it hard to price a job or commit to a new plant.
The bill travels downstream
Costs that pile onto parts do not stop at the supplier. They move down the line into repair bills and the sticker price of a new car.
Here's the gist
Auto parts are made across a border that both countries now tax, so suppliers absorb the trade war before drivers ever see it.
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