American auto jobs could be lost quickly in tariff war

By Chris Isidore and Vanessa Yurkevich, CNN

New York (CNN) — Looming tariffs on imported cars could mean more than just higher prices for buyers and lower profits for automakers – it could also mean layoffs for American autoworkers.

President Donald Trump says his auto tariffs will remake the industry, shifting production of both cars and auto parts back to American plants. But experts say that will take years to accomplish, if it happens at all. In the meantime, it will take a toll on US car and auto parts production.

The auto supply chain is delicate and global. Even if only Mexican and Canadian assembly plants shut down due to lost access to the US market, that will affect US suppliers sending parts to those plants. And some US-built cars are destined for Canada and Mexico. All that could see automakers and parts suppliers trimming production – and less output means fewer US jobs.

“The automakers are in a serious predicament,” said Patrick Anderson, president of the Anderson Economic Group, a Michigan-based think tank. “They’re going to have to make tough decisions about what production to continue, what not to make… We expect implementation of these tariffs to affect jobs across the United States.”

Anderson said that in addition to manufacturing job losses, other auto-related US jobs will likely be impacted in sectors like dealerships and transportation.

Trump promises auto job gains

The Trump administration insists that tariffs will be a net positive for US jobs, with the president forecasting “tremendous growth” for the American auto industry. Automakers will respond by shifting production quickly to US factories at relatively little cost, according to Trump and his supporters.

“This is going to lead to the construction of a lot of plants, in this case auto plants,” he said when announcing the tariffs last week. “You’re going to see numbers like you haven’t seen… in terms of employment. You’re going to have a lot of people making a lot of cars.”

The tariff move was even applauded by Sean Fain, United Auto Workers union president and a harsh critic of Trump.

“With these tariffs, thousands of good-paying blue collar auto jobs could be brought back to working-class communities across the United States within a matter of months, simply by adding additional shifts or lines in a number of underutilized auto plants,” said a statement from the union. “Right now, thousands of autoworkers are laid off at Ford, General Motors, and Stellantis following recent decisions by auto executives to ship jobs to Mexico.”

While some production could shift back relatively quickly from Mexico and Canada to US plants producing the same model, that’s not the case for most of the 3.6 million vehicles those countries export here. Many Canadian and Mexican assembly lines construct models not made in America, and it will likely take years to build or retrofit US factories. That is, assuming the automakers even decide to do so.

Still, some rank-and-file autoworkers are optimistic about job gains.

“I trust the process,” said Isaiah Goddard, a third-generation autoworker at Ford’s Rawsonville Components and Parts plant in Michigan. “Get ready for Ford and the Big Three to announce more jobs and plants coming back to America soon.”

But other autoworkers who spoke to CNN last week were not as hopeful about Trump’s tariff promises.

“There are some that feel it’s good, that it’ll prop up our sales,” said James Snow, who has worked for Stellantis’ parts division, Mopar, for nearly 27 years. “Others like myself feel that it won’t help that much, especially considering the tariffs will impact the price of parts.”

John Hatline, who retired earlier this month after 50 years at GM, said he doesn’t believe Trump’s tariffs will “be good for the auto industry at all.”

“His tariffs are going to raise the prices of vehicles, slowing down the consumers purchasing of new vehicles, which will subsequently result in layoffs and less production time, affecting auto workers’ paychecks,” Hatline said.

Jobs at risk from lost production

The industry is staying mum about future plans.

Automakers and MEMA, a trade group for suppliers, declined to comment about production and employment plans. And there is no firm estimate for how many jobs could be lost in the near-term.

But tariffs are about to upend an industry that has functioned in North America as a single market for decades, moving freely across borders to assemble vehicles.

About 61% of the 4 million cars built in Mexico last year were exported to US dealerships, according to S&P Global Mobility. A whopping 86% of the 1.3 million built in Canada were sent to the US. But all of those vehicles were built with a significant number of US-made parts.

US auto parts exports to Mexico and Canada came to $35.8 billion and $28.4 billion, respectively, last year, according to federal trade data.

American parts suppliers employ about 550,000 workers – nearly twice as many as auto assembly plants. Some of those suppliers could be forced to cut staffing if Canadian and Mexican plants shut down, even temporarily.

And retaliatory tariffs by Canada and Mexico in response to the Trump administration’s tariffs would raise prices for car buyers north and south of the border. That could risk US production and jobs as well. US assembly plants exported nearly 15% of the 10.2 million vehicles made last year, with nearly 1 million going to Canada and Mexico alone.

Cox Automotive predicts that there will be 10% to 20% fewer cars produced across North America due to the upcoming auto tariffs, which take effect April 3. And if the tariffs extend to Canadian and Mexican auto parts, that could mean as much as a 30% drop.

“We are committed to building and investing in the US, but these facilities and supply chains are massive and complex and can’t be relocated or redirected overnight,” said John Bozzella, CEO of the Alliance for Automotive Innovation, the automakers’ industry trade group, in a statement.

“Additional tariffs will increase costs on American consumers, lower the total number of vehicles sold inside the US and reduce US auto exports – all before any new manufacturing or jobs are created in this country,”

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