WASHINGTON — European and Asian car brands aren't the only ones that have to worry about new economic sanctions after the U.S. withdrew from the multilateral Iran nuclear accord.
In repudiating the agreement signed in 2015, the Trump administration has staked out a hard-line position against Iran that could include a complex sanctions regime. That means global suppliers and even U.S. automakers will need to be extra careful about who they do business with to avoid getting tripped up by legal problems that could disrupt operations, experts say.
"If you've got a supplier that's doing risky activity that could be subject to U.S. sanctions, and they get put on a [restricted party] list, then that could impact the supply of parts to you and might require cutting ties with that supplier," said Steven Brotherton, who heads the export controls and sanctions practice at Sandler, Travis & Rosenberg.
The U.S. policy U-turn presents yet another wild card for a global industry already reeling from a series of political shocks, including acrimonious negotiations on the North American Free Trade Agreement, a trade war with key U.S. allies over steel and aluminum imports and an escalating trade dispute with China. It highlights the challenge of managing international political risk as the Trump administration's "America First" policies force manufacturers to rethink their investment plans and supply networks.
"The auto sector was one of the biggest beneficiaries when the nuclear deal was struck in 2015," BMI Research wrote in a note. Now, it's one of the primary areas targeted by the Treasury Department for snapback sanctions. Non-U.S. companies have until Aug. 6 to unwind operations in Iran to avoid facing possible U.S. enforcement actions, according to the Office of Foreign Assets Control, which can bar U.S. companies from doing business with blacklisted foreign companies or individuals.