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Automakers tremble in Asia as Trump threatens Mexico tariffs

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Automakers tremble in Asia as Trump threatens Mexico tariffs

TOKYO (Reuters) – Shares of major Asian automakers and suppliers tumbled on Friday after U.S. President Donald Trump threatened to slap tariffs on imports from Mexico from next month, potentially upending a decades-old business model of global manufacturers.

FILE PHOTO: A Toyota logo is displayed at the 89th Geneva International Motor Show in Geneva, Switzerland March 5, 2019. REUTERS/Pierre Albouy

Railing against a surge of illegal immigrants across the United States’ southern border, Trump said he would hit all goods coming from Mexico with a 5% tariff, and would increase that each month until reaching 25% on Oct. 1, unless Mexico takes immediate action.

The move could hit a number of global companies – including American and Asian firms – with the auto industry looking particularly vulnerable. For years carmakers have built vehicles in Mexico, taking advantage of its cheap labor, trade deals and proximity to the United States, the world’s largest auto market after China.

It also looks also likely to backfire on U.S. consumers, driving up the prices of goods as varied as cars, refrigerators and television sets.

“Margins are so thin in the U.S. market right now that there’s no way that any automaker is not going to pass on these tariffs to their customers,” said Janet Lewis, an analyst at Macquarie Securities.

“The unknown factor is the impact on suppliers, as components can move back and forth between Mexico, the United States and Canada up to 20 times before they make their way into assembled cars.”

In Japan, shares in Toyota Motor Corp fell 2% while Nissan Motor Co dropped 5% and Honda Motor Co nearly 4%. Mazda Motor Co took a bigger hit, tumbling nearly 7%. All four operate vehicle assembly plants in Mexico, producing roughly one-third of the vehicles made there.

AUTOS, NUCLEAR REACTORS

Vehicles and parts were the biggest imports from Mexico to the United States, totaling $93.3 billion in 2018, followed by electric machines, nuclear reactors, minerals and oil, and optical equipment, according to U.S. government data.

In South Korea, Hyundai Motor Co and affiliate Kia Motors Corp fell 0.7% and 4.2% respectively. Hyundai Wia Corp, which supplies auto components to the duo, tumbled 6.2%.

“Although we have to wait and see whether the U.S. tariffs plan will be really implemented, this is negatively affecting investor sentiment,” said Chang Moon-su, an analyst at Hyundai Motor Securities in Seoul.

Another South Korean manufacturer, LG Electronics Inc, said nearly all of its television sets made in Mexico are shipped to the United States, and about a third of its refrigerators.

“As the United States is a crucial market for us, we are closely monitoring this tariff issue,” a company representative told Reuters.

Japan’s top automakers and their suppliers, including Denso Corp and Aisin Seiki Co, have been building vehicles in Mexico for decades, both for the domestic market and for export to the United States, taking advantage of the North American free-trade agreement, which includes Canada.

Among them Nissan produces the most vehicles in Mexico, with its U.S. exports accounting for roughly one-quarter of its total vehicle sales there, industry experts say. Its Sentra and Versa models are made in Mexico for the U.S. market.

Smaller rival Mazda exports about 30% of its Mexico-produced cars to the United States. Toyota, which has been expanding U.S. production of pick-up trucks, exports less than 10% percent, as does Honda.

Japanese automakers together produced about 1.25 million vehicles in Mexico in 2018.

But production in Mexico is dwarfed by the number of cars they produce in the United States, their single largest market, where Japan’s top three manufacturers alone produce roughly 4 million vehicles each year.

Reporting by Naomi Tajitsu; Additional reporting by Hayoung Choi and Heekyong Yang in Seoul; Editing by Christopher Cushing and David Dolan

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Trump rips New York Times over Kavanaugh piece, calls for resignation of anyone involved in ‘SMEAR story’

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Trump rips New York Times over Kavanaugh piece, calls for resignation of anyone involved in 'SMEAR story'

President Trump blasted The New York Times over its supposed bombshell report on Supreme Court Justice Brett Kavanaugh, calling on “everybody” involved in the “smear” to resign.

“I call for the Resignation of everybody at The New York Times involved in the Kavanaugh SMEAR story, and while you’re at it, the Russian Witch Hunt Hoax, which is just as phony!” Trump tweeted Monday evening.

“They’ve taken the Old Grey Lady and broken her down, destroyed her virtue and ruined her reputation… She can never recover, and will never return to Greatness, under current Management. The Times is DEAD, long live The New York Times!”

NEW YORK TIMES CRITICIZED FROM BOTH SIDES OVER NOW-REVISED KAVANAUGH ALLEGATIONS

Late Sunday, The New York Times walked back an explosive report about a resurfaced allegation of sexual assault by Kavanaugh from his college days. The piece by Robin Pogrebin and Kate Kelly, adapted from their forthcoming book, alleged there was corroboration of an incident in which Kavanaugh, as a college student at Yale, exposed himself to a female classmate at a party.

However, The Federalist’s Mollie Hemingway — who reviewed an advance copy of the book – flagged an omission and the paper eventually revised the controversial story after being lampooned on social media over the gaffe.

The update included the significant detail that several friends of the alleged victim said she did not recall the purported sexual assault. The newspaper also stated for the first time that the alleged victim refused to be interviewed, and has made no other comment about the episode.

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Trump was asked about whether anyone from The Times should be “fired” over the controversy. He called it a “fair” question but didn’t directly give an answer.

“I think The New York Times made another terrible mistake,” Trump said. “It’s a shame that a thing like that could happen… They used to have a thing called fact-checking. They don’t have fact-checking anymore.”

Fox News’ Brian Flood and Gregg Re contributed to this report.

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With New Mexico rally, Trump seeks to flip state won by Clinton in 2016

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With New Mexico rally, Trump seeks to flip state won by Clinton in 2016

WASHINGTON (Reuters) – President Donald Trump will hold one of his signature rallies on Monday night in New Mexico, a longtime Democratic stronghold his campaign has added to the list of states it hopes to win in the November 2020 election.

FILE PHOTO: U.S. President Donald Trump holds a campaign rally in Fayetteville, North Carolina, U.S., September 9, 2019. REUTERS/Kevin Lamarque/File Photo

The last time New Mexico supported a Republican in a presidential race was 2004. Democratic presidential nominee Hillary Clinton beat Trump there by 8 percentage points three years ago.

Trump’s campaign sees an opening in the state with Latinos, who it believes will swing his way despite tough immigration policies, including a crackdown on migrants from Central America and a push to build a wall along the U.S. border with Mexico.

Democrats have criticized those efforts. But a Trump campaign aide said the Republican president could win over Latinos who came to the United States legally and believe others should, too.

“Big crowd expected in New Mexico tonight, where we will WIN. Your Border Wall is getting stronger each and every day — see you in a few hours!” Trump tweeted ahead of his trip.

The campaign also views Trump’s support for the fossil fuel industry as a plus in the state, which is rich in oil and natural gas, said the campaign aide, who declined to be named. Trump is likely to discuss energy on Monday night.

Trump won the White House in 2016 with electoral votes from traditional Republican-leaning states and some surprise Democratic-leaning ones.

The Trump campaign says it wants New Mexico’s five electoral votes to augment the 306 electoral votes the president received in his first election, not create a separate path for victory. A candidate must get 270 electoral votes nationally to win.

Democrats, who did well in New Mexico during the 2018 mid-term elections, are skeptical.

“Last cycle, Democrats crushed Republicans in New Mexico because voters are fed up with President Trump’s toxic healthcare agenda and broken promises,” said David Bergstein, a communications director for the Democratic National Committee focused on battleground states.

“We take nothing for granted, but this GOP strategy looks like they’re concerned about a realistic pathway to 270 electoral votes,” he added.

Trump won electoral-vote-rich swing states such as Ohio and Florida in 2016, while also picking up Wisconsin, Michigan and Pennsylvania from Democrats.

The campaign says it is eyeing more pickups in 2020, including Colorado, New Hampshire, Minnesota and Nevada.

Reporting by Jeff Mason; Editing by Colleen Jenkins and Tom Brown

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California adds Iowa to ‘travel ban’ over refusal to fund gender transitions

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California adds Iowa to 'travel ban' over refusal to fund gender transitions

California announced Monday that it has added Iowa to the list of states on its ever-expanding “travel ban” list because of that state’s new prohibition against funding gender-transition surgeries under Medicaid.

The announcement by state Attorney General Xavier Becerra means that as of Oct. 4, California will no longer offer taxpayer-funded trips to Iowa for any public employee or student at a state-run university.

Becerra’s authority came from a 2016 California law signed by then-Gov. Jerry Brown that bars state-funded travel to other states that undercut LGBT rights. The list already included Alabama, Kentucky, North Carolina, Texas, Oklahoma and Mississippi.

WATCH: LIBERAL POLICIES BLAMED FOR WORSENING CALIFORNIA’S HOMELESSNESS CRISIS

Conservatives have called the law ineffective, inconveniencing, possibly unconstitutional and hypocritical. The state’s sports teams have turned to private funding to get around the restrictions, according to The Los Angeles Times.

A homeless woman smokes as she waits for city crews to clean the area near Los Angeles City Hall Monday, July 1, 2019. California is overrun with homeless individuals. (AP Photo/Richard Vogel)

A homeless woman smokes as she waits for city crews to clean the area near Los Angeles City Hall Monday, July 1, 2019. California is overrun with homeless individuals. (AP Photo/Richard Vogel)

“The Iowa Legislature has reversed course on what was settled law under the Iowa Civil Rights Act, repealing protections for those seeking gender-affirming health care,” Becerra said in a statement. “California has taken an unambiguous stand against discrimination and government actions that would enable it.”

The brouhaha began after the Iowa Supreme Court ruled in March that taxpayers could be forced to pay for gender reassignment surgery. Republican Gov. Kim Reynolds signed a law effectively overriding that ruling two months later.

At the federal level, the Trump administration has disputed the idea that sex-based discrimination prohibitions under law include protections for gender identity. The Health and Human Services Department, in May, angered progressive advocates with rules that both allowed doctors not to perform certain operations and stated that “gender identity” was not protected under sex discrimination law in health care.

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Fox News’ Sam Dorman contributed to this report.

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