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Greenville Business Magazine

The Trouble with Tariffs: What hurts BMW and Volvo hurts us all

Nov 08, 2018 10:31AM ● By Chris Haire

I’m not a sentimental guy. I’m not really interested in taking family photos. I don’t keep my two girls’ report cards or drawings or any of the awards or knickknacks they’ve accumulated over the years. I’m horrible with birthdays and anniversaries and any occasion where you have to buy cards or flowers or chocolates. I’ve never shed a tear watching “This Is Us.” But my heart swells just a touch whenever I drive by the BMW plant in Greer. 

I know, I know, it’s silly, but I can’t help but feel a sense of pride knowing that our state landed the mighty German carmaker more than two decades ago. It put South Carolina — and the Upstate in particular — on the map and positively affected thousands of lives as jobs were created and those jobs led to the creation of other jobs, even those not tied to the automotive industry. Heck, you only have to stroll down Main Street in Greenville to see the how the auto giant impacted the area.

OK, I may be taking all of that too far. Plans were firmly in place to revitalize downtown Greenville well before BMW’s arrival and numerous other manufacturers brought jobs to South Carolina and helped fill our community coffers. But still, the BMW effect was, to use the parlance of our president, huge.

All of that said, I get that same feeling when I’m driving by the Volvo Cars plant in Berkeley County. Like BMW and the North Charleston Boeing plants before it, I know the tremendous impact that the Swedish automaker is about to have on the Lowcountry. And yet, I also feel uneasy as the thought runs through my mind that somehow all of this progress might come to a halt; that this economic boom that South Carolina has been experiencing is coming to an end.

The reason for this worry is obvious. Unless you’ve been running wild with the Lizard Man through Scape Ore Swamp, you know the answer: tariffs.

I’m not the only one who’s feeling uneasy.

A wide variety of organizations — from the Federal Reserve to the National Association of Home Builders to our very own state Chamber of Commerce — have come out against President Trump’s tariffs.

While Trump has repeatedly threatened to target German automakers — in particular, BMW and Mercedes-Benz, which operates a van plant in Ladson — the president has yet to actually slap a tariff on imported goods from those manufacturers.

That doesn’t mean the state’s automotive industry isn’t already feeling woozy from another one of Trump’s trade fights.

According to a recent Post and Courier report by business writer David Wren, the ongoing trade war with China is already hurting the automotive business in the Palmetto State. In the article, BMW stated that Chinese tariffs — those placed in retaliation to U.S. tariffs — will cause the Greer plant to lose nearly $350 million in business when 2018 is said and done, while Volvo is eyeing a move to shift production of its S60 sedan to the People’s Republic so they can dodge the import hike and sell to Chinese car buyers at a profitable price.

At the moment, no decisions have been made — at least publicly.

Be that as it may, I can’t shake this feeling of uneasiness, this fear that one day I’ll drive by BMW or Volvo or Boeing and feel not pride, but a bittersweet nostalgia for better days.