Faced with the prospect of doubled inventory costs and stymied consumer demand, Inland Northwest dealers of Japanese luxury imports are surprisingly unfazed.
Most say the tariffs won’t significantly dent overall sales. Many are optimistic that negotiations will force a repeal of the sanctions, which could double the cost of high-end Infiniti, Lexus, Acura, Mazda and Mitsubishi models.
“I don’t think there are any dealers who believe the sanctions are going to go into effect,” said Chris Marr, president of the Spokane New Automobile Dealers Association. Like others, Marr believes the World Trade Organization would declare the punitive tariffs void if the United States imposed them.
No local dealers are planning layoffs or cutbacks due to the tariffs. Even the six employees at Appleway’s Lexus of Spokane need not fret, said owner Tim Pring.
“We have a substantial investment in Lexus, but it’s a small part of our business,” he said. He added that in the unlikely scenario that the Lexus dealership shut down, Appleway’s seven other dealerships would absorb the workers.
Given Spokane’s traditionally mediocre demand for luxury imports, dealers here have never relied on luxury sales. So the tariffs, which could go into effect next week, will not impact local dealers, they say.
“We’re not worried at all,” said Steve Smith, a salesman at Ponderosa Acura.
The sanctions affect those Japanese luxury imports valued at $25,000 to $50,000. For Acura dealers, that means one model - the Legend - would see sticker prices double. Smith said the Legend accounts for two percent of sales.
Local Mazda dealers were similarly nonchalant about the proposed tariffs, which would affect the 929 and Millenia. According to co-owner Gene Reed, trucks are the main draw at Post Falls Mazda.
Still, the tariffs enrage Reed. The Clinton administration’s insistence on penetrating the Japanese market harks back to the 1950s, when America was the world’s automotive behemoth, he said.
“The glory days of the U.S. auto manufacturers are gone. It will never be again. This may be an awakening for a lot people,” Reed said.
Pring dismissed the sanctions as devoid of economic justification.
“It’s all political,” he said. He added that the Clinton administration may be pandering to 800,000 United Auto Workers voters over the 315,000 dealers, port workers and truck drivers whose jobs depend on Japanese luxury imports.