MNI: Moody's weighs in on US Pres Trump's threat.....>

MNI: Moody's weighs in on US Pres Trump's threat of 25% tariff on auto and parts

imports Friday, "would be largely credit negative for global auto industry." GM

and Ford that import vehicles are vulnerable to tariffs, Moddy's said. "Both GM

and Ford would need to absorb the cost of scaling back Mexican and Canadian

production and shifting some back to the US," notes Bruce Clark, Moody's ssenior

VP, "they would also likely need to subsidize sales to offset the tariffs during

the near term, and could eventually pass on the higher costs to 

consumers." Meanwhile, Japan "would need to significantly adjust their

production" while a "25% tariff would hurt both Mexico's car production and the

country's economy as a whole, as numerous automakers have built assembly plants

in Mexico to service the US market, resulting in the auto industry representing

2.9% of Mexico's GDP in 1Q 2018."