Vanessa Miller on Impact of ‘Liberation Day’ Tariffs on Automotive Industry – ‘Disputes Could Escalate Quickly'
Foley & Lardner LLP partner Vanessa Miller discussed how the automotive industry is reacting to the Trump administration’s “Liberation Day” announcement of new tariffs in The Detroit News article, “Trump tariffs prompt retaliation, plunging stocks, auto plant shutdowns.”
Miller, chair of Foley’s national Automotive Team, said “tensions over contractual language that often doesn’t even mention tariffs — and who must pay for them — is rising” and there could be an increase in lawsuits involving automakers, suppliers, and overseas manufacturers in the future.
Typically suppliers will tell customers that they “cannot absorb the cost of these tariffs” and will “need to talk about price increases” because the tariffs are not sustainable for any period of time, and so far automakers have largely responded by requesting a grace period from suppliers. “But disputes could escalate quickly,” she said. “The nuclear option is to threaten stop-ship, saying we’re not going to ship you product unless you proactively agree to pay these tariffs. And if that happens, the automakers are likely to respond by asking a judge to intervene,” she said.
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