BMW warns tariffs would hurt production, risk jobs in the U.S.

Haley Walters | The Greenville News

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BMW has warned that U.S. tariffs on imported cars could drive up manufacturing costs and risk jobs in South Carolina.

In a letter to the U.S. Department of Commerce, BMW warned that more proposed tariffs would hurt the automaker's ability to expand its investment in the U.S., where tariffs on steel and retaliation from other countries have already driven up costs, according to a report by Reuters. BMW is the largest auto exporter by value in the U.S.

The Trump administration has threatened a 20 percent tariff on auto imports from the European Union and is investigating whether or not imported cars pose a national security risk, according to Reuters. BMW has a heavy presence in the Upstate, and it's been expanding as BMW improves its Spartanburg County manufacturing facility - they've spent at least $52 million in the last year on such improvements, The Greenville News reported.

More: Tariffs rattle South Carolina's manufacturing supply chain

More: 5 things South Carolinians should know about the Trump administration's tariffs

“The domestic manufacture of automobiles has no apparent correlation with U.S. national security,” BMW wrote in a letter to U.S. Secretary of Commerce Wilbur Ross, according to Reuters.

More than 70 percent of BMW cars produced in South Carolina are shipped to other export markets, Reuters reported.

BMW announced last year that it would invest $600 million to improve its Spartanburg County facility, but the company said threats of tariffs on cars and components as well as retaliation from other countries makes the U.S. a less appealing option. China has already imposed tariffs of their own in response to U.S. decisions, and BMW fears more could come from the E.U., Reuters reported.

“All of these factors would substantially increase the costs of exporting passenger cars to these markets from the United States and deteriorate the market access for BMW in these jurisdictions, potentially leading to strongly reduced export volumes and negative effects on investment and employment in the United States,” BMW said in the letter, according to Reuters.