Trump aluminum, steel tariffs inject fresh fear into auto industry

00:04:36
https://www.youtube.com/watch?v=UByDjsUdyBA

Summary

TLDRThe video discusses the current state of the auto industry, emphasizing the contrasting fortunes of automakers like Ford and Hyundai, which have seen sales increases due to strong demand for SUVs and trucks. However, the industry is also grappling with looming tariffs that could impact pricing and inventory levels. The conversation highlights the challenges faced by other automakers, such as Stellantis and Nissan, which are struggling with excess inventory and the need to discount prices. Additionally, the rising costs of steel due to tariffs and a potential shortage of rare earth magnets from China are significant concerns for production. GM's CEO has a somewhat positive view of tariffs, suggesting they could help U.S. automakers compete against heavily subsidized foreign competitors, but the overall outlook remains complex and uncertain.

Takeaways

  • 🚗 Ford and Hyundai sales up due to strong SUV demand.
  • 📉 Other automakers face challenges from tariffs and excess inventory.
  • 💰 Steel tariffs increase manufacturing costs significantly.
  • ⚠️ Potential shortage of rare earth magnets could disrupt production.
  • 🌍 GM's CEO sees tariffs as a way to level the playing field against foreign competitors.

Timeline

  • 00:00:00 - 00:04:36

    The discussion begins with excitement about the auto industry, highlighting the recent sales increases for automakers Ford and Hyundai due to strong demand for SUVs and trucks. However, looming tariffs are causing concern, as they may lead to future pain for the industry despite current strong sales figures. Auto expert Matt Miller explains that while some automakers are benefiting from increased demand, others are struggling due to tariffs, leading to inventory issues and price competition. The conversation shifts to the impact of steel tariffs, which significantly raise production costs for cars, and the potential shortage of rare earth magnets from China, which could disrupt production. GM's CEO expresses a somewhat positive view on tariffs, suggesting they could level the playing field against foreign competitors, particularly China, which has heavily subsidized its auto industry. However, the overall sentiment is cautious, as the tariffs may not effectively curb Chinese growth and could push U.S. automakers to focus more on the domestic market.

Mind Map

Video Q&A

  • What is the current state of the auto industry?

    The auto industry is experiencing increased sales for some automakers like Ford and Hyundai, driven by strong demand for SUVs and trucks, but faces challenges from tariffs and inventory issues.

  • How are tariffs affecting automakers?

    Tariffs are pushing some consumers to buy cars now to avoid future price increases, but they also create challenges for automakers who must discount prices to compete.

  • What is the impact of steel tariffs on car prices?

    Steel tariffs add significant costs to car manufacturing, potentially increasing the price of each vehicle by $1,000 to $2,000.

  • What is the concern regarding rare earth magnets?

    There is a looming shortage of rare earth magnets from China, which could disrupt production and lead to factory closures.

  • How have tariffs been perceived by GM's CEO?

    GM's CEO suggested that tariffs could help level the playing field with foreign competitors, particularly those subsidized by their governments.

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  • 00:00:04
    >> I WANT YOU TO GET EXCITED
  • 00:00:06
    >> I WANT YOU TO GET EXCITED BECAUSE WE ARE STILL TALKING
  • 00:00:07
    BECAUSE WE ARE STILL T TALKING MONEY. POWER POLITICS.
  • 00:00:09
    MONEY. POWER POLITICS. AUTOMAKEKERS FORD AND HYUNDAI SW
  • 00:00:10
    AUTOMAKERS FORD AND HYUNDAI SAW THEIR SALES GO UP IN MAY ON
  • 00:00:12
    THEIR SALES GO UP IN MAY ON STRONG SUV AND TRUCK DEMAND. BUT
  • 00:00:14
    STRONG SUV AND TRUCK DEMAND. BUT TARIFFS, THEY ARE STILL LOOMING
  • 00:00:15
    TARIFFS, THEY ARE STILL LOOMING OVER THE INDUSTRY. AND BARRON'S
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    OVER THE INDUSTRY. AND BARRON'S IS REPORTING THAT DESPITE STRONG
  • 00:00:19
    IS REPORTING THAT DESPITE STRONG SALES, THE PAIN IS COMING. I
  • 00:00:22
    SALES, THE PAIN IS COMING. I WANT TO BRING IN MY ALL TIME
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    WANT TO BRING IN MY ALL TIME FAVORITE AUTO EXPERT MY DEAR
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    FAVORITE AUTO EXPERT MY DEAR FRIEND MATT MILLER, ANCHOR FOR
  • 00:00:28
    FRIEND MATT MILLER, ANCHOR FOR BLOOMBERG TV'S OPEN INTEREST. HE
  • 00:00:30
    BLOOMBERG TV'S OPEN INTEREST. HE COVERS THE AUTO INDUSTRY BETTER
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    COVERS THE AUTO INDUSTRY BETTER THAN ANYONE I KNOW, AND HE'S
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    THAN ANYONE I KNOW, AND HE'S CO-HOST OF THE HOT PURSUIT
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    CO-HOST OF THE HOT PURSUIT PODCAST. IT IS FANTASTIC TO SEE
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    PODCAST. IT IS FANTASTIC TO SEE YOU. TELL US, WHAT IS THE STATE
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    YOU. TELL US, WHAT IS THE STATE OF T THE AUTO INDUSTRY RIGHT NO?
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    OF THE AUTO INDUSTRY RIGHT NOW? >> YOU KNOW.
  • 00:00:41
    >> YOU KNOW. >> THE I INTERESTING THING IS
  • 00:00:43
    >> THE INTERESTING THING IS THEY.
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    THTHEY. >> HAVE TWO FORCES AT PLAY HERE.
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    >> HAVE TWO FORCES AT PLAY HERE. ONE IS THE TARIFFS.
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    ONE IS THE TARIFFS. >> ARE PUSHING.
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    >> ARE PUSHING. >> PEOPLE TO BUY.
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    >> PEOPLE TO BUY. >> CARS NOW RATHER THAN YOU
  • 00:00:52
    >> CARS NOW RATHER THAN YOU KNOW. THEY'RE WORRIED THAT
  • 00:00:53
    KNOW. THEY'RE WORRIED THAT PRICES WILL GO UP LALATER. SO
  • 00:00:54
    PRICES WILL GO UP LATER. SO THEY'RE.
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    THEY'RE. >>>> PULLING DEMAND FORWARD. AND
  • 00:00:57
    >> PULLING DEMAND FORWRWARD. AND THAT'S WHY YOU SEE THESE GREAT
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    THAT'S WHY Y YOU SEE THESE GREAT NUMBERS RIGHT. FORD SALES UP.
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    NUMBERERS RIGHT. FORD SALES UP. >> 16 ALMOST 17%.
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    >> 16 ALMOST 17%. >> ON THE OTOTHER HAND. THERE AE
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    >> ON THE OTHER HAND. THERE AREE A LOT OF AUTOMAKERS THAT ARE IN
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    A LOT OF AUTOMAKERS THAT ARE IN SERIOUS. TROUBLE ALSO BECAUSE OF
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    SERIOUS. TROUBLE ALSO BECAUSE OF THESE TATARIFFS. STELLANTIS,
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    THESE TARIFFS. STELLANTIS, NISSAN. AND THEY HAVE.
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    NISSAN. AND THEY HAVE. >> TO DISCSCOUNT RIGHT. THEY HA.
  • 00:01:10
    >> TO DISCOUNT RIGHT. THEY HAVE. >> CARS SITTING ON.
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    >> CARS SITTING ON. >> LOTS FOR.
  • 00:01:12
    >> LOTS FOR. >> 90 DAYS F FOR.
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    >> 90 DAYS FOR. >>>> 100 DAYS.
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    >> 1 100 DAYS. >> AT RAM. 107 DAYS OF
  • 00:01:15
    >> AT RAM. 107 DAYS OF INVENTORY.
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    INVENTORY. >> AND SO THAT. IS PUSHINGNG.
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    >> AND SO THAT. IS PUSHING. PRICES DOWN. AND SO FORD, FOR
  • 00:01:20
    PRICES DOWN. AND SO FORD, FOR EXAMPLE.
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    EXAMPLE. >> OR GM, THEY.
  • 00:01:22
    >> OR GM, THEY. >> THEY RAISE PRICES BECAUAUSE.
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    >> THEY RAISE PRICES BECAUSE. >> THEY CAN. WRITE A LOT OF
  • 00:01:26
    >> THEY CAN. WRITE A LOT OF DEMAND, BUT.
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    DEMAND, BUT. >> THEN THEY HAVE TO LOWER TO.
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    >> THEN THEY HAVE TO LOWOWER TO. >> COMPETE AGAINST.
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    >> COMPETE AGAINST. >> THESE OTHER AUTOMAKAKERS. AND
  • 00:01:31
    >> THESE O OTHER AUTOMAKERS. AND IT'S CAUSING A LITTLE BIT OF A
  • 00:01:32
    MUDDLE. >> WHAT ARARE THE STEEL TARIFFS
  • 00:01:33
    >> WHAT ARE THE STEEL TARIFFS GOING TO DO. THE AUTO INDUSTRY.
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    GOING TO DO. THE AUTO INDUSTRY. >> I WAS LOOKING IT UP BEFORE I
  • 00:01:36
    >> I WAS LOOKING IT UP BEFORE I CAME ON THE PROGRAM. SO STEEL
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    CAME ON THE PROGRAM. SO STEEL REPRESENTS ABOUT 2,800.
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    REPRESENTS ABOUT 2,800. >> POUNDS.
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    >>>> POUNDS. >> OF EACH CAR. IT'S OVER
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    >> OF EACH CAR. IT'S OVER $1,000, ALMOST $2,000 OF COST
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    $1,000, ALMOST $2,000 OF COST FOR EACH CAR. AND IT'S GETTING
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    FOR EACH CAR. AND IT'S GETTING BACK TO RECORD PRICES BECAUSE OF
  • 00:01:48
    BACK TO RECORD PRICES BECAUSE OF THESE TARIFFS. SO ALMOST $1,000
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    THESE TARIFFS. SO ALMOST $1,000 FOR A TON OF HOT.
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    FOR A TON OF HOT. >> ROLLED STEEL.
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    >> ROLLED STEEL. >> SO IT'S GOING.
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    >> TO PUSH. >> THOSE PRICES HIGHER.
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    >> THOSE PRICES HIGHER. >> OBVIOUSLY REUTERS IS
  • 00:01:57
    >> OBVIOUSLY REUTERS IS REPORTING THAT GLOBAL AUTO
  • 00:02:00
    REPORTING THAT GLOBAL AUTO EXECUTIVES ARE SOUNDING THE
  • 00:02:01
    EXECUTIVES ARE SOUNDING THE ALARM OVER SOMOMETHING. MOST OFS
  • 00:02:03
    ALARM OVER SOMETHING. MOST OF US KNOW NOTHING ABOUT. AN IMPMPENDG
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    KNOW NOTHING ABOUT. AN IMPENDING SHORTAGE OF RARE EARTH MAGNETS
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    SHORTAGE OF RARE EARTH MAGNETS THAT COME FROM CHINA. IT COULD
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    THAT COME FROM CHINA. IT COULD FORCE THE CLOSURE OF CAR
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    FORCE THE CLOSURE OF CAR FACTORIES, THEY SAY, WITHIN
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    FACTORIES, THEY SAY, WITHIN WEEKS. WHAT WHAT WHAT IS THIS?
  • 00:02:13
    WEEKS. WHAT WHAT WHAT IS THIS? >> WELL, IT COULD AND HAS. F FOD
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    >> WELL, IT COULD AND HAS. FORD HAS ALREADY HAD TO HALT
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    HAS ALREADY HAD TO HALT PRODUCTION AT A CHICAGO FACILILY
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    PRODUCTION AT A CHICAGO FACILITY BECAUSE OF A SHORTAGE OF THESE
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    BECAUSE OF A SHORTAGE OF THESE RARE EARTH MAGNETS. THEY'RE USED
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    RARE EARTH MAGNETS. THEY'RE USED IN EVERYTHING FROM WINDSHIELD
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    IN EVERYTHING FROM WINDSHIELD WIPER MOTORS TO ANTI-LOCK
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    WIPER MOTORS TO ANTI-LOCK BRAKING SYSTEMS. AND AUTOMAKERS
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    BRAKING SYSTEMS. AND AUTOMAKERS ARE SCRAMBLING TO TRY AND GET A
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    ARE SCRAMBLING TO TRY AND GET A HOLD OF MORE OF THIS STUFF
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    HOLD OF MORE OF THIS STUFF BECAUSE THEY ARE GOING TO FACE
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    BECAUSE THEY ARE GOING TO FACE SHORTAGES, ESPECIALLY IF THIS US
  • 00:02:34
    SHORTAGES, ESPECIALLY IF THIS US CHINA TRADE WAR HEATS UP.
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    CHINA TRADE WAR HEATS UP. >> BUT SOME THINGS SURPRISEDED .
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    >> BUT SOME THINGS SURPRISED ME. GM CEO MARY BARRA ACTUALLYLY HAD
  • 00:02:39
    GM CEO MARY BARRA ACTUALLY HAD SOMETHING KIND OF POSITIVE TO
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    SOMETHING KIND OF POSITIVE TO SAY ABOUT THE TARIFFS, WHERE SHE
  • 00:02:43
    SAY ABOUT THE TARIFFS, WHERE SHE SAID THEY CAN POTENTIALLY HELP
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    SAID THEY CAN POTENTIALLY HELP LEVEL THE PLAYING FIELD WITH
  • 00:02:46
    LEVEL THE PLAYING FIELD WITH FOREIGN COMPETITORORS.
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    FOREIGN COMPETITORS. >> YEAH, WELL, LOOK, YOU HAVE TO
  • 00:02:51
    >> YEAH, WELL, LOOK, YOU HAVE TO GIVE IT TO TRUMP THAT SOME
  • 00:02:53
    GIVE IT TO TRUMP THAT SOME FOREIGN COMPETITORS, CHINA, FOR
  • 00:02:55
    FOREIGN COMPETITORS, CHINA, FOR EXAMPLE, HAVE REALLY SUBSIDIZED
  • 00:02:56
    EXAMPLE, HAVE REALLY SUBSIDIZED THEIR CAR INDUSTRY. CHINA'S
  • 00:02:57
    THEIR CAR INDUSTRY. CHINA'S POURED $230 BILLION INTO THEIR
  • 00:03:00
    POURED $230 BILLION INTO THEIR CAR INDUSTRY SINCE 2009. AND I
  • 00:03:04
    CAR INDUSTRY SINCE 2009. AND I GUESS WHAT TRUMP IS TRYING TO DO
  • 00:03:06
    GUESS WHAT TRUMP IS TRYING TO DO IS SOMETHING SIMILAR ON ON THE
  • 00:03:07
    IS SOMETHING SIMILAR ON ON THE TAX SIDE OF THINGS. RIGHT? HE
  • 00:03:09
    TAX SIDE OF THINGS. RIGHT? HE WANTS TO HE THINKS THAT TAXING
  • 00:03:12
    WANTS TO HE THINKS THAT TAXING US CONSUMERS TO BUY CARS IS
  • 00:03:14
    US CONSUMERS TO BUY CARS IS GOING TO SOMEHOW SLOW DOWN THE
  • 00:03:16
    GOING TO SOMEHOW SLOW DOWN THE CHINESE GROWTH. BUT IT'S NOT.
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    CHINESE GROWTH. BUT IT'S NOT. AND THE PROBLEM IS IT'T'S REALLY
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    AND THE PROBLEM IS IT'S REALLY PUSHING G US AUTOMAKERS BUSINESS
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    PUSHING US AUTOMAKERS BUSINESS BACK INTO THE US. I WAS LOOKING
  • 00:03:23
    BACK INTO THE US. I WAS LOOKING THIS MORNING, 2014, GM SOLD 10
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    THIS MORNING, 2014, GM SOLD 10 MILLION CARS AROUND THE WORLD.
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    MILLION CARS AROUND THE WORLD. 2024 THEY SOLD 4 MILLION CARS
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    2024 THEY SOLD 4 MILLION CARS AROUND THE WORLD. AND THE REASON
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    AROUND THE WORLD. AND THE REASON IS THEY HAVE JUST HAD TO PULL
  • 00:03:34
    IS THEY HAVE JUST HAD TO PULL OUT OF ALL OF THESE OTHER
  • 00:03:36
    OUT OF ALL OF THESE OTHER MARKETS AS BRANDS FROM CHINA
  • 00:03:37
    MARKETS AS BRANDS FROM CHINA LIKE BYD AND GEELY JUST T GROW
  • 00:03:41
    LIKE BYD AND GEELY JUST GROW AROUND THE WORLD, GETTING INTO
  • 00:03:42
    AROUND THE WORLD, GETTING INTO OTHER REGIONS IN ASIA, IN SOUTH
  • 00:03:45
    OTHER REGIONS IN ASIA, IN SOUTH AMERICA, IN EUROPE, THEY'VE
  • 00:03:46
    AMERICA, IN EUROPE, THEY'VE REALLY RETREATED. WE REALLY HAVE
  • 00:03:48
    REALLY RETREATED. WE REALLY HAVE RETREATED BACK TO A DOMESTIC
  • 00:03:50
    RETREATED BACK TO A DOMESTIC MARKET.
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    MARKET. >>>> SO IS THERE A CHANCE THAT
  • 00:03:53
    >> SO IS THERE A CHANCE THAT THESE TARIRIFFS COULD BE GOOD FR
  • 00:03:54
    THESE TARIFFS COULD BE GOOD FOR THE AUTOMAMAKERS?
  • 00:03:57
    THE AUTOMAKERS? >> I CAN'T REALLY SEE THAT IF
  • 00:03:59
    >> I CAN'T REALLY SEE THAT IF THEY WORKED THE WAY THE
  • 00:04:00
    THEY WORKED THE WAY THE PRESIDENT WANTS THEM TO, RIGHTH.
  • 00:04:02
    PRESIDENT WANTS THEM TO, RIGHT. IF THEY SOMEHOW STOPPED THE
  • 00:04:04
    IF THEY SOMEHOW STOPPED THE GROWTH OF THE CHINESE INDUSTRY,
  • 00:04:05
    GROWTH OF THE CHINESE INDUSTRY, OR IF THEY WERE A NEGOTIATING
  • 00:04:07
    OR IF THEY WERE A NEGOTIATING TOOL, IF THEY GOT CHINA TO STOP
  • 00:04:09
    TOOL, IF THEY GOT CHINA TO STOP SUBSIDIZING THEIR AUTO INDUSTRY
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    SUBSIDIZING THEIR AUTO INDUSTRY AND TO LOWER NON-TARIFF.
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    AND TO LOWER NON-TARIFF. >> BARRIERS, WHICH IS NOT GOING
  • 00:04:14
    >> BARRIERS, WHICH IS NOT GOING TO.
  • 00:04:15
    TO. >> HAPPEN, THEN THEY WOULD THEN
Tags
  • auto industry
  • Ford
  • Hyundai
  • tariffs
  • SUV demand
  • steel prices
  • rare earth magnets
  • GM
  • market trends
  • automakers