Don't lower auto content value: NAFTA steel group
- September 21, 2015
Three trade associations representing steel producers in Canada, the US and Mexico are urging negotiators of the Trans-Pacific Partnership (TPP) to maintain regional auto content amdist reports that a lower regional value content is under consideration.
The leaders of the Canadian Steel Producers Association (CSPA), the American Iron and Steel Institute (AISI), and CANACERO (Mexico), sent a letter to Ed Fast, Canadian Minister of International Trade of Canada; Ildefonso Guajardo Villarreal, Secretary of Economy of Mexico; and, Mike Froman, United States Trade Representative for the US, urging "a TPP that will strengthen the competitiveness of North American steel producers by enabling continued growth for motor vehicle component and finished vehicle manufacturers."
The groups wrote that, based on reports, proposed changes would lower regional value content (RVC) for auto parts and light duty vehicles, currently set by NAFTA at 62.5 per cent for autos, light trucks, engines and transmissions, and 60 per cent for other auto parts.
"Our members strongly oppose lowering such regional value content requirement," the letter states. "The TPP must not confer an advantage to producers whose primary supply chain is located outside the TPP region."
Jpseph Galimberti, president of CSPA, says, "we are very much opposed to any measures in the TPP agreement which would undermine the long-term global competitiveness of Canadian steelmakers, and their customers."
Thomas J. Gibson, president and CEO of AISI, says "the auto supply chain is inextricably linked to the health of our countries' respective steel industries and the prosperity of the North American auto and auto parts industries. The standards must not be reduced."
Salvador Quesada Salinas, director general of Canacero, said, "Canacero is very concerned about the possible impact of relaxing in TPP the NAFTA regional value content for auto parts and light duty vehicles. This will imply lower employment generation."