National Electrical Manufacturers Association (NEMA) President and CEO Kevin Cosgriff said the new import tariffs on steel and aluminum will create unwelcome challenges for many electrical manufacturers, particularly related to certain types of electrical steel not made in the U.S. and the overly broad restrictions on imported aluminum.
"Our industry uses steel and aluminum from domestic and overseas sources in their manufacturing processes. The President's decision to impose import taxes on fairly-traded steel and aluminum will not help our manufacturers' costs or aid them in being more competitive in the global economy," said Cosgriff. "We believe the opposite to be the case."
The President's proclamation imposes a global 25 percent tariff on certain steel imports and 10 percent tariff on certain aluminum imports to begin in 15 days. The President concluded that Canada and Mexico present a special case and steel and aluminum from those two countries are not covered by the announcement. In addition, the proclamation notes that any country with which the U.S. has a "security relationship" can "discuss with the United States alternative ways to address the threatened impairment of the national security caused by imports from that country."
The President's decision came at the close of separate 11-month processes conducted under the authority of Section 232 of Trade Expansion Act of 1962, regarding national security implications of steel and aluminum imports.
NEMA joined with other industry associations to raise specific concerns about the Commerce Department recommendations and findings, which were transmitted to the White House in January and released to the public on February 16.
Regarding steel, NEMA sought to exclude identified steels from the scope of import restrictions, citing lack of domestic supply used in various electrical products like motors, transformers, and batteries. While the Administration did not exclude these steels, the announcement does provide a path to qualify for an import exemption through a petition process for individual companies if they can demonstrate a lack of domestic supply in terms of quantity as well as the quality of needed steel and/or aluminum. Regarding aluminum, NEMA called for targeted action aimed at addressing over-capacity production in China and not to target fairly-traded aluminum from other countries.
"The president's proclamation provides a great deal of discretion and flexibility in how the final tariff program is implemented, including adjusting the scope, the countries impacted, the nature of the remedy and the period of time the restrictions are in place," added Cosgriff. "NEMA will continue to and work with the administration to mitigate unintended consequences of the import tariffs while promoting a robust and job-growing electrical manufacturing industry."