General Motors (GM) on Wednesday downgraded its expected earnings for 2018 because of costs associated with the Trump administration’s steel and aluminum tariffs.
Reuters reported that the company expected to face a $1 billion impact on its full-year results, an increase from the $500 million it had previously projected. Most of its additional costs were incurred in America, Chief Financial Officer Chuck Stevens told reporters.
However, he added that the GOP tax-reform legislation passed late last year and low unemployment should help mitigate some losses from the tariffs in 2018.
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“What happens beyond 2018, there’s a lot of uncertainty in this space at this point in time,” Stevens said.
The Trump administration implemented steep tariffs on aluminum and steel imports earlier this year. The move prompted a number of other countries to impose retaliatory tariffs.
U.S. steel producers have raised their prices to keep up with the new tariffs, leading to higher costs for GM, Reuters reported.
Despite overwhelming criticism of his trade policy, President Trump has doubled down on the tariffs. He has argued they are necessary to secure better trade deals with Canada, Mexico, the European Union and China, even as lawmakers warn that they ultimately hurt American workers.