Chinese Goods, Robotics and Industrial Machinery Could Face New Tariffs

As the Supreme Court prepares to hear oral arguments on the constitutionality of using the International Emergency Economic Powers Act to enact new tariffs, the Trump administration continues to use other tools to restrict imports.

In September, the U.S. Department of Commerce initiated a Section 232 investigation under the Trade Expansion Act to assess whether imports of robotics and industrial machinery, or their parts and components, pose a risk to national security. Section 232 is the same law the administration used to impose a 50 percent tariff on steel and aluminum from most countries. The new investigation includes CNC machining centers, turning and milling machines, grinding and deburring equipment, and industrial stamping and pressing machines, as well as other machinery. As part of the investigation, the U.S. Department of Commerce is reviewing the feasibility of increasing domestic production of robotics and industrial machinery and the role of foreign supply chains in meeting U.S. demand.

China has been one of the biggest targets of the Trump administration’s trade actions. Earlier this year, the president set a 145 percent tariff on Chinese goods, and China announced that it would likewise impose a 125 percent tariff on American products. The two countries soon de-escalated the dispute and agreed to work toward a long-term trade agreement. While that negotiation is ongoing, the U.S. lowered tariffs on China to 30 percent, and China lowered its tariffs on the U.S. to 10 percent.

In August, the sides extended the negotiation period another 90 days until Nov. 10. However, China announced on Oct. 9 that it would prohibit the export of rare earth materials for use by foreign militaries, a move that is expected to hamper the United States’ ability to build missiles and modern aircraft, such as the F-35. In response, President Donald Trump threatened to hike Chinese tariffs up to 100 percent on Nov. 1, before the end of the negotiating period. U.S. Trade Representative Jamieson Greer has since said that whether that new tariff goes into effect will depend on how the situation develops.

Additionally, a three-judge panel of the U.S. Court of Appeals for the Federal Circuit ruled that the first Trump administration was within its rights to expand Section 301 tariffs to $300 billion worth of Chinese goods. The decision allows the tariffs to stand, covering products such as semiconductors, electric vehicles, certain minerals, and lithium-ion batteries.