On Dec. 15, Stefan Selig, U.S. Under Secretary of Commerce for International Trade, released the “Trans-Pacific Partnership (TPP) Opportunities for the U.S. Automotive Sector” report. The report details how the elimination of various tariffs and other TPP commitments to level the playing field will benefit American companies competing in TPP markets. The automotive sector, as defined in the report, includes products such as motor vehicles, motorcycles and auto parts such as vehicle engines, transmissions and tires.
“U.S. businesses and workers in the automotive sector will be positively impacted by the elimination of many barriers once TPP is enacted,” said Selig. “TPP is a high-standard agreement that levels the playing field for our products, making made-in-America goods more attractive to the fast-growing Asia Pacific region.”
The U.S. automotive sector employed 928,000 workers in 2014, according to the Commerce report. During the same time period, exports totaled $2.4 billion to the TPP markets where the U.S. does not currently have trade agreements. The report details the current barriers the sector faces in TPP countries, and demonstrates how the industry stands to benefit once the trade agreement takes effect.
Currently, there are five TPP countries with which the United States does not have preferential market access – Brunei, Japan, Malaysia, New Zealand and Vietnam. Once TPP becomes law:
- Japan will remove non-tariff barriers that impede automotive exports.
- Malaysia will eliminate import taxes on 75.8 percent of U.S. automotive exports within four years.
- Vietnam will eliminate import taxes on 70.4 percent of U.S. automotive exports within four years.
- The U.S. will implement a long phase-out of its tariffs for cars and trucks.
To view the full report, click here.
