House labor caucus urges quotas on auto imports from Mexico, Canada

The Trump administration should consider imposing quotas on auto imports from Mexico and Canada as part of the upcoming review of the U.S.-Mexico-Canada Agreement, a group of House Democrats said in a letter on Monday.

“In strategic sectors like auto, the parties should use tools like quotas to safeguard minimum levels of domestic production,” the lawmakers wrote. The letter, addressed to U.S. Trade Representative Jamieson Greer, was signed by 69 of the 127 members of the Congressional Labor Caucus, which is led by Reps. Debbie Dingell (D-Mich.), Donald Norcross (D-N.J.), Mark Pocan (D-Wis.), and Steven Horsford (D-Nev.).

The Trump administration earlier this year imposed 25 percent duties on autos and auto imports from Canada and Mexico, while agreeing in separate trade deals to 15 percent tariffs on auto imports from the European Union, Japan, and South Korea.

Imposing quotas would add an additional layer of import protection and would likely be strongly resisted by the two North American trading partners, who until recently had duty-free access for their auto exports to the United States. It would also raise the question of whether the U.S. should impose quotas on auto imports from other countries.

The letter also urged USTR to push for tougher “rules of origin” for autos and other sectors like aerospace, agricultural equipment and large appliances to reduce the amount of non-North American content that can be used in products produced in the region.

Comments deadline: Monday is USTR’s deadline for public comment for consideration in next year’s mandatory review of the U.S.-Canada-Mexico Agreement. Trade ministers from the three countries are expected to meet on July 1 to say whether they want to continue the agreement or let it expire as currently scheduled on July 1, 2036.

As of this afternoon, interested groups and individuals had filed more than 1,100 comments with the trade agency, a sign of the widespread interest in the fate of the agreement. USTR will hold a public hearing on Nov. 17 as part of the review process

The labor caucus members, in their letter on Monday, outlined a number of other recommendations, including pressuring Mexico to raise wages and labor standards; strengthening and expanding the USMCA’s labor “rapid response mechanism,” which allows USTR to target individual companies in Mexico for alleged labor violations; and ensuring both Canada and Mexico fully enforce a ban on goods made with forced labor.

Democrats also called for USTR to strengthen protections against competition from China by incorporating new rules against transhipment through Canada and Mexico and requiring the two North American countries to screen foreign investment “that may pose risks to essential supply chains in the United States.”