Ahead of the 2024 presidential election, former President Donald Trump has made headlines with his latest trade policy proposal, promising hefty tariffs on vehicles produced by alleged Chinese factories in Mexico.
What Happened: Billionaire entrepreneur Mark Cuban criticized former President Trump’s threat to impose a 200% tariff on John Deere, listed on the New York Stock Exchange as Deere & Co (NYSE:DE), for moving production to Mexico. In a post on X, Cuban called it a “good way to destroy a legendary American company.”
Cuban responded to Collin Rugg, owner of Trending Politics, who reported Trump’s comments made at a policy roundtable in Smithton, Pennsylvania. Trump warned John Deere of a 200% tariff if they proceed with plans to shift some production to Mexico.
“This Lack of Understanding of Business is insane,” Cuban wrote.
Trump’s comments were made while speaking to farmers, emphasizing his knowledge and love for John Deere. He stated, “If you do that, we’re putting a 200% tariff on everything that you want to sell into the United States,” highlighting his campaign’s focus on tariffs.
John Deere’s webpage details the company’s commitment to U.S. manufacturing and explains the necessity of moving less complex operations to other locations.
Why It Matters: Trump’s recent tariff threats are not isolated incidents. Last week, Trump vowed to impose 200% tariffs on Chinese-made cars produced in Mexico, warning of a potential collapse of the U.S. auto industry if Vice President Kamala Harris wins the 2024 election. He reiterated these claims during a town hall event in Flint, Michigan, despite the lack of evidence supporting the existence of such factories.
According to the Bureau of Labor Statistics, since President Joe Biden took over, auto and parts jobs have jumped by 13.6%, reaching 1.07 million by August. Car sales even ticked up by 2.4% in the first half of this year. The idea that the U.S. auto industry is on its last legs seems a stretch at the very least.
The U.S. has been strategically decoupling from China, a trend expected to continue regardless of the 2024 election outcome. Both Harris and Trump are likely to maintain this stance, impacting Chinese companies outsourcing to or investing in factories in Southeast Asia and Mexico.
Additionally, the Biden administration has proposed banning vehicles equipped with Chinese software, citing national security concerns. The U.S. Commerce Department aims to prevent nearly all Chinese cars from entering the U.S. market, further complicating the trade landscape.
Price Action: Deere & Co stock closed at $408.95 on Monday, up 0.75% for the day. In after-hours trading, the stock dipped 1.53%. Year to date, Deere & Co has risen by 2.01%, according to data from Benzinga Pro.
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This story was generated using Benzinga Neuro and edited by Kaustubh Bagalkote
