(Bloomberg) -- The U.S. Commerce Department has asked carmakers to reveal some of their most closely held secrets as part of its investigation of whether tariffs on imported cars and components are needed to safeguard national security.
A 34-page questionnaire from the department’s Bureau of Industry and Security was sent to several automakers this month seeking sensitive details about company finances, factories, supply chains and other topics.
“The breadth and depth of this request is invasive, requiring massive amounts of proprietary and confidential business data from global operations -- all under the pretense of national security,” said Gloria Bergquist, spokeswoman for the Alliance of Automobile Manufacturers, which represents several carmakers who received the survey.
The alliance represents a dozen automakers including General Motors Co., Toyota Motor Corp. and Volkswagen AG.
“Frankly, it’s stunning from an administration committed to getting government out of the way of business,” Bergquist said.
The survey’s cover page says recipients are required by law to respond to the survey, and those who don’t could be sentenced to up to one year in prison and a $10,000 fine.
A department representative didn’t immediately respond to a request for comment.
The questionnaire is part of an investigation begun in May into whether imports of autos and auto parts hurt U.S. national security. The probe is being conducted using a rarely used 1960s trade law that President Donald Trump employed earlier this year to impose tariffs on steel and aluminum imports.
“There is evidence suggesting that, for decades, imports from abroad have eroded our domestic auto industry,” said Commerce Secretary Wilbur Ross said when announcing the investigation. “The Department of Commerce will conduct a thorough, fair, and transparent investigation into whether such imports are weakening our internal economy and may impair the national security.”
Automakers have warned new tariffs will damage their business by disrupting their supply chains and raising costs for consumers.
Under the Section 232 of the the Trade Expansion Act of 1962, Ross has until February to conclude the probe and make recommendations for Trump, who has threatened to slap tariffs of up to 25 percent on imported cars.
The Commerce Department has scheduled a hearing on the investigation for July 19 in Washington. About 45 people, representing foreign and domestic companies, labor and others, are scheduled to give testimony. The hearing was originally slated to take place over two days but Commerce announced Thursday that it would be limited to one day.
Dave Sullivan, an auto industry analyst at AutoPacific Inc., said the level of detail sought by the government is "disturbing."
"The only time I’ve seen something like that is when a supplier is not doing very well financially and the automaker is trying to understand their financial state and their future," he said. "They’re fully undressing automakers and how they do their business to a disturbing level."
--With assistance from David Welch and Joe Deaux.
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