The U.S. Commerce Department is asking automakers to spill their secrets; product planning, financing, supply chains, and other bits that aren't in public filings.
Bloomberg reports that the department’s Bureau of Industry and Security sent out a 34-page questionnaire asking for sensitive details to several automakers. Failure to do so could result "in a maximum fine of $10,000, imprisonment of up to one year, or both" as mentioned on the first page of the survey.
“The breadth and depth of this request is invasive, requiring massive amounts of proprietary and confidential business data from global operations -- all under the pretense of national security,” said Gloria Bergquist, spokeswoman for the Alliance of Automobile Manufacturers - a group that represents a number of companies including General Motors, Toyota, and Volkswagen.
“Frankly, it’s stunning from an administration committed to getting government out of the way of business.”
This is part of the Commerce Department’s investigation into whether or not the imports of cars and car parts hurt U.S. national security opened in late May. It may result in imported vehicles being hit with tariffs as high as 25 percent.
What is being asked in this survey?
QuoteThe Trump administration wants such things as how much each company’s research budget goes to specific areas such as autonomous driving, electric drive, connected vehicles, and lightweight technology. The questionnaire also seeks a list of suppliers for major vehicles systems and where they’re located.
Other questions deal with the business plan from now until 2020 and whether or not imports hurt sales.
Susan Helper, a former chief economist of the Commerce Department during the Obama administration said Bureau of Industry and Security has conducted dozen of these surveys in the past, mostly dealing with sectors closely linked to the defense industry.
“This is a consequence of the Trump administration’s expanded definition of national security I hadn’t thought about. I can see both sides on this -- it is burdensome for companies, but on the other hand it’s important for policy makers to understand global supply chains as they have an increasing impact on the U.S. economy,” Helper told Bloomberg.
Dave Sullivan, an analyst at AutoPacific told Bloomberg that the level of information that the government is asking is "disturbing'.
“The only time I’ve seen something like that is when a supplier is not doing very well financially and the automaker is trying to understand their financial state and their future. They’re fully undressing automakers and how they do their business to a disturbing level.”
The Commerce Department will be holding a hearing on the investigation on July 19th in Washington D.C. Around 45 people, representing various automakers, labor unions, and more will be testifying.
Source: Bloomberg, Link to Questionnaire
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