The White House’s Peter Navarro Accuses Germany, Japan, and South Korea of Turning the U.S. into an Assembly Hub
Peter Navarro, the U.S. White House adviser on trade and manufacturing, recently criticized Germany, Japan, and South Korea for allegedly reducing the U.S. to an “assembly country” rather than a manufacturing one. In an interview with Fox News on March 30th, Navarro argued for the necessity of automobile tariffs, claiming that these countries send the most crucial, high-value, and well-compensated parts of automobiles to the U.S. for assembly. He noted that only 19% of cars purchased and driven in the U.S. annually have American-made engines and transmissions.
Navarro stated that among the 16 million vehicles bought in the U.S. each year, half are imported without any American parts, and the other half are made with 50% foreign components. He emphasized the need to bring back the manufacturing capacity that Mexico, Germany, Japan, and South Korea have taken.
Previously, President Trump announced a 25% tariff on completed cars and auto parts produced outside the U.S., set to progressively apply from May 3rd for completed vehicles and parts, beginning with initial tariffs on April 3rd.
Additionally, President Trump plans to implement reciprocal tariffs on April 2nd. Under this plan, if a trading partner imposes higher tariffs on U.S. goods, the U.S. would raise its tariffs on that country’s goods to achieve balance. Kevin Hassett, director of the National Economic Council, mentioned that the president would decide which countries would be subject to these reciprocal tariffs.
In response to concerns about the inflationary impact of tariffs in the U.S., Navarro claimed that foreign countries would bear most of the price increase. He argued that foreign players would have to absorb the rising costs to stay in the American market, the largest in the world. Additionally, Navarro estimated that automobile tariffs could generate $100 billion annually in tax revenue and overall tariffs could bring in $600 billion for the U.S. each year.