Despite all of the bluster by the Trump administration about levying tariffs on steel and aluminum, the U.S. Commerce Department has offered plenty of tariff waivers on auto companies. Most of those have been for steel, but Tesla just got the government to waive 10% tariffs on imported aluminum from Japan.
Tesla said in government documents that it needed the Japanese aluminum for the production of battery cells at Tesla’s Nevada Gigafactory. The company made the request in April, and the waiver is good for a year.
Nippon Light Metal Co. Ltd. is the aluminum producer and Tesla asked for an exclusion for 10,000 tons annually, Reuters reported. The approval was apparently given on June 5, after the department found the aluminum “is not produced in the United States in a sufficient and reasonably available amount or of a satisfactory quality.”
Tesla asked for exclusions on several different widths and thicknesses of aluminum sheets, noting that U.S. manufacturers cannot “meet the alloy composition or thickness requirements. Domestic producers also cannot meet the annual volume requirement.”
(Musk making moves on mission to Mars. Click Here for the story.)
The battery cells are assembled into packs that power the Tesla Model 3. They’re also used for the company’s energy storage products, Tesla said in its request. “Tesla is the only U.S. manufacturer of these battery types and planned production of these batteries will increase exponentially over the next few years,” the company’s request said.
Tesla previously sought other tariff exemptions from the U.S. Trade Representative’s Office for Chinese-made parts, including the Model 3 car computer and the Autopilot “brain” that were rejected, Reuters noted.
Automakers have had reasonable success getting waivers on steel from China.
(Click Here for more about Musk hyping Tesla’s performance, future to shareholders.)
The Commerce Department approved tariff exemption requests from 370 companies for up to 4.1 million tons of foreign steel, through the end of March. Overall, about 8% of the total came from China and nearly 30% from Japan, according to the Associated Press.
They haven’t made things more difficult for any type of automaker: foreign or domestic. The recipients of the waivers include Toyota, Hyundai, Mercedes-Benz and Volkswagen. In terms of Big Three makers, only Fiat Chrysler asked for a steel-tariff exemption.
Fiat Chrysler received exemptions for all seven requests it made for hot-dip galvanized carbon sheet-steel, used for many applications in the automotive industry. The exemption waived duties on 9,198 tons of German steel.
(To see more about whether Trump’s trade wars will backfire or not, Click Here.)