Mercedes Benz

UPDATED: 8/28/18 4:06 pm ET Judging from the jump in General Motors Co. and Ford Motor Co. shares, the market thinks President Donald Trump's accord with Mexico to replace the North American Free Trade Agreement will enable U.S. automakers to carry on business as usual. This could be right, with one big caveat: The companies are going to need Canada to join the deal, too. The preliminary agreement announced Monday allows carmakers to import vehicles duty-free if 75 percent of the content is made in the U.S. and Mexico. That's up from 62.5 percent minimum under Nafta. Under the U.S.-Mexico deal, as much as 45 percent of parts will also have to be made by workers who are paid more than $16 an hour, according to U.S. Trade Representative Robert Lighthizer. “The vast majority of vehicles made in the U.S., Mexico and Canada are above the requirements,” said Kristin Dziczek, vice president of industry, labor and economics at the Center for Automotive Research in Ann Arbor, Mich. “If ...

General Motors has asked the U.S. government for an exemption from the tariff now placed on the China-made Buick Envision it distributes to American dealers. But granting the exemption would be a bad idea. Too much is at stake to start making exceptions for a particular product. If GM is afraid that the tariff puts its model at a disadvantage, then it should consider lowering the price or offering an incentive to maintain the Envision's competitiveness in America. Today, there may be few models imported from China, but it's certain we will see an increase in the next couple of years. Several Chinese car companies are bound to set up dealer networks and make plans to import tens of thousands of vehicles. It would be foolish to give one vehicle an exemption today just because the automaker happens to be GM. It would have a serious practical and political impact for quite some time. Tariff and nontariff barriers have had a damaging effect on U.S. exports around the globe. Hopefull...