(By Observer Net, Zhang Jiadong; Editor: Gao Xin)

On July 11 local time, US President Trump threatened to impose a 50% tariff on imported copper metals, a decision that once again raised vigilance in the US automotive industry.

NAI 500

Several auto company executives, industry analysts and experts said this move could make it harder for car manufacturers and suppliers to deal with car tariffs and rising costs.

Currently, the US market heavily relies on imported copper, aluminum and steel. Because developing new capacity may take several years, tariff pressures may cause automakers and suppliers to increase their purchases of related metals in the short term, thus stimulating price increases.

In recent months, most automobile manufacturers have been relying on inventory to avoid raising product prices, but the rising raw material costs caused by increased metal prices may force automakers to pass on the costs to consumers.

At present, Ford, Toyota and other companies have announced price increases to alleviate the cost pressure caused by Trump's tariffs, while Porsche expects that the tariffs in April and May alone will cause a loss of 300 million euros (about 2.51 billion yuan RMB).

Foreign media such as Reuters pointed out in related reports that although the tariff itself may have some room for maneuver, due to the instability of the tariff policy, the prices of metals essential for the automobile industry (especially the wiring harnesses and engines of electric vehicles) have already soared to record highs.

Changes in New York copper futures prices from January to July this year, Reuters

Data shows that since Trump took office at the beginning of the year, the actual trading price of aluminum in the Midwest of the United States has more than doubled based on the benchmark price of the London Metal Exchange (LME), reaching 1322.7 dollars per ton (about 9482.4 yuan RMB per ton).

Daan de Jonge, Chief Analyst for Copper Demand and Prices at Benchmark Mineral Intelligence (BMI), a battery raw materials consulting company, said: "The copper tariff has made the already difficult situation in the automotive industry even more complicated."

Consulting firm CRU Group estimates that an ordinary internal combustion engine or hybrid vehicle requires about 24kg of copper, while an ordinary all-electric vehicle requires about 59kg.

De Jonge said that according to the previous tax rates, steel, aluminum and copper accounted for about 5% of the production costs of American cars, but after the tariff takes effect, this proportion will rise to 9%.

According to an estimate combining implemented tariffs and planned copper prices by Cox Automotive and BMI, the minimum tariff per car produced in the United States is 1700 dollars (about 12,000 yuan RMB); the minimum tariff for a car imported from Canada and Mexico under the USMCA agreement is 3500 dollars (about 25,000 yuan RMB); the cost of importing a car from other countries can be as high as 5700 dollars (about 41,000 yuan RMB).

Getty Images

Some experts said that after a week of tariff threats in the copper metal market, many suppliers have already asked automakers to pay higher product prices this week because they are unable to bear the additional costs, and these prices have already reflected in the new car prices of automakers.

Data released by consulting company J.D.Power shows that the average price of new cars in the US reached 46233 dollars (about 331,000 yuan RMB) in June.

A senior source from a large automotive supplier in the US market said that the price increases of copper, aluminum and steel not only caused commercial friction, but also created structural cost gaps. This impact has occurred even before any tariffs take effect, and US users need to pay higher prices for the rise in copper prices.

Melanie White, president of suspension component manufacturer Hellwig Products, said that since 2018, the price of steel in the US has risen four times. And Trump's steel tariffs are causing companies to purchase from US suppliers. Due to the limited number of suppliers, apart from price increases, stable steel supply has become more difficult.

To cope with these changes, White said the company would cut costs by delaying equipment purchases or reducing hiring positions.

However, some companies and analysis institutions also said that the 50% import copper tariff announced by the Trump administration will be difficult to sustain.

Takemura Takashi, a senior executive of Marubeni Corporation in Japan, said, "When they (the US government) reconsider the damage, I ultimately expect them to reduce or cancel the tariff."

Andy Leyland, co-founder of US market research company SC Insights, also recently said that the copper tariff may not last long, because a series of US tariffs previously imposed have led to an inflation cycle that conflicts with the midterm election date of the US president (November 2026)."Most Americans don't really care about foreign policy, inflation is the only issue people really care about," Leyland added.

This article is an exclusive article from Observer Net, and it is prohibited to reproduce without permission.

Original: https://www.toutiao.com/article/7526789053488972314/

Statement: The article represents the personal views of the author. Please express your attitude below [top/foot] button.