U.S. hikes steel, aluminum tariffs on imported appliances, railcars, EV parts

The U.S. Commerce Department said on Tuesday it is hiking steel and aluminum tariffs on more than 400 products including wind turbines, mobile cranes, appliances, bulldozers and other heavy equipment, along with railcars, motorcycles, marine engines, furniture and hundreds of other products.

The department said 407 product categories are being added to the list of "derivative" steel and aluminum products covered by sectoral tariffs, with a 50 per cent tariff on any steel and aluminum content of these products plus the country rate on the non-steel and non-aluminum content.

Evercore ISI — an American research department — said in a research note the move covers more than 400 product codes representing over $200 billion US in imports last year and estimates it will raise the overall effective tariff rate by around one percentage point.

The department is also adding imported parts for automotive exhaust systems and electrical steel needed for electric vehicles to the new tariffs as well as components for buses, air conditioners as well as appliances including refrigerators, freezers and dryers.

A group of foreign automakers had urged the department not to add the parts, saying the U.S. does not have the domestic capacity to handle current demand.

Tesla unsuccessfully asked the commerce department to reject a request to add steel products used in electric vehicle motors and wind turbines, saying there was no available U.S. capacity to produce steel for use in the drive unit of EVs.

The new tariffs take effect immediately and also cover compressors and pumps and the metal in imported cosmetics and other personal care packaging like aerosol cans.

"Today's action expands the reach of the steel and aluminum tariffs and shuts down avenues for circumvention – supporting the continued revitalization of the American steel and aluminum industries," said Under Secretary of Commerce for Industry and Security Jeffrey Kessler.

Steelmakers including Cleveland Cliffs and others had petitioned the administration to expand the tariffs to include additional steel and aluminum auto parts.