U.S. Sen. Lamar Alexander, R-Tenn., on Wednesday warned that President Donald Trump's tariffs on imported autos and parts could damage Tennessee's economy more than any other state.
In hearing with Sen. Doug Jones, D-Ala., Alexander encouraged the administration to reconsider the steps it's taking to impose tariffs.
"When I walked across the state running for governor 40 years ago, there were very few auto jobs in Tennessee, the state was the third poorest state in family incomes, unemployment and inflation were high and prospects were bleak," he said on the Senate floor. "Then in 1980, Nissan from Japan arrived in Rutherford County. Then General Motors with Saturn to Spring Hill and then Volkswagen to Chattanooga, all with large manufacturing plants. As the American automobile industry moved to the Southeastern United States, more than 900 auto parts suppliers located in 88 of our 95 counties.
Now, the lawmaker said, 136,000 Tennesseans, representing one-third of the state's workforce, work in auto plants across the state.
"Nothing has done more during the last 40 years to raise family incomes in Tennessee than the arrival of the auto industry, and nothing could do more to damage those family incomes than the proposed tariffs on imported automobiles and automotive parts, combined with the tariffs on imported steel and aluminum that the administration has already imposed," Alexander said. "In fact, Tennessee is likely to be hurt more than any other state by these tariffs."
Alexander is working with Jones to introduce legislation as soon as next week to encourage the administration to reconsider imposing tariffs on imported automobiles and automotive parts.
"I agree with President Trump on many things: taxes, judges, regulations, the economy, the Keystone Pipeline – he's helped create today's booming economy and lower unemployment," Alexander said. "These tariffs take us in exactly the opposite direction. These tariffs are dangerous, they are going to cost us jobs and lower our family incomes, and they will undo much of the good the president and Republican Congress have done to restore the economy."
Tennessee is home to three major auto assembly plants - the Chattanooga-based Volkswagen facility, Smyrna-based Nissan and a General Motors plant in Spring Hill. Some components they use are imported.
The state-based auto manufacturers and suppliers have become an increasingly important part of Tennessee's economy. The state now has more than 135,000 workers in its overall automotive industry in 917 locations, leading most Republican politicians in Tennessee to differ with Trump over the proposed import tariffs.
"I am very concerned about the president abusing the authorities granted to him in Section 232 of the Trade Expansion Act of 1962," said U.S. Sen. Bob Corker, chairman of the Senate Foreign Relations Committee and strong opponent of the proposed tariffs. The senator and former Chattanooga mayor, who played a major role helping to persuade Volkswagen to locate its lone U.S. plant in Hamilton County, called the administration's action "a dangerous course [that] should be abandoned immediately."
U.S. Rep. Chuck Fleischmann, R-Tenn., whose district includes the Volkswagen plant, said that "in the best interests of my constituents in East Tennessee, I hope that current automobile trade regulations are maintained."
A group representing major automakers will tell the U.S. Commerce Department today that imposing tariffs of 25 percent on imported cars and parts would raise the price of U.S. vehicles by $83 billion annually and would cost hundreds of thousands of jobs. The Alliance of Automobile Manufacturers, a trade group representing General Motors Co, Volkswagen AG , Toyota Motor Corp and others, predicts the tariffs would raise the price of an imported car nearly $6,000 and the price of a U.S.-built car $2,000.
That has drawn opposition from even traditionally staunch Trump allies such as U.S. Rep. Marsha Blackburn, R-Tenn., who is running to succeed Corker in the U.S. Senate
"I think I've never hesitated to bring up things that are items of concern to Tennesseans - and I will continue to do so," Blackburn said.
Her Democratic opponent to succeed Corker, Phil Bredesen, called the tariffs a dangerous "game of chicken."
"Job-creators like Volkswagen should not be put on the stand, begging for their chance to continue investing in Tennessee. It's time to stand up to the Commerce Department to make it clear that these tariffs are not just a tax on Tennessee - they are job killers. We've made too much progress and we can't afford to let Washington's political potholes stall job creation."
Tennessee Gov. Bill Haslam said he also objects to imposing tariffs on imported automobiles and questions claims of national security used to justify the tariffs against cars imported from U.S. ally countries such as Japan, Germany, South Korea and Canada.
"I'm just not certain that using the national security reasons to put a tariff on cars is the right path," Haslam said.
Contact Andy Sher at asher@timesfreepress.com