President Donald Trump isn’t wasting any time pressing Detroit’s Big Three Automakers to build more cars in America.
In just the first week of his Presidency, Trump met jointly with the heads of General Motors, Ford and Fiat Chrysler. During Tuesday’s meeting he urged them to build more plants in the U.S. in order to boost jobs. The President also vowed to cut regulations and taxes to make it more attractive to do so.
“We have a very big push on to have auto plants and other plants — many other plants,” Trump told reporters at the meeting. “It’s happening.”
Before the meeting, he tweeted: “I want new plants to be built here for cars sold here!”
The meeting also gave Detroit’s automakers a key opportunity to weigh in on major issues the new administration plans to tackle early on, including trade, regulatory and tax reforms along with environmental issues.
Trump reportedly told the CEOs that environmental regulations are “out of control” and promised he would remove obstacles for manufacturers and oil companies. The president reiterated his desire to reduce regulations, which may indicate a willingness to scale back federal fuel-economy demands. As I recently mentioned on the radio show, it’s clear the automakers are playing nice in hopes of avoiding the 54.5 fuel economy average that takes effect in 2025.
“I am, to a large extent, an environmentalist,” Trump told the auto executives. “I believe in it, but, it’s out of control.”
Tuesday’s gathering was the first time the CEOs of the big three automakers have met jointly with a U.S. President since 2011. That’s when they met with President Barack Obama to discuss those 2025 fuel economy standards.
Ford CEO Mark Fields discussed corporate tax reform, the need for “data-driven regulations” and trade policy initiatives that address foreign currency manipulation, Ford spokeswoman Christin Baker said.
GM CEO Mary Barra and Chrysler CEO Sergio Marchionne also attended. Marchionne told reporters after the meeting that Trump did not give them specifics on what regulations he would cut.
GM, Ford and FCA have all announced recent new jobs and investments in the U.S., but are still investing in Mexico. Fields said automakers wanted to work with Trump to create a “renaissance in American manufacturing.”
“We’re very encouraged by the president and the economic policies that he’s forwarding,” Fields told reporters, praising Trump’s decision to withdraw from the Trans-Pacific Partnership agreement, which Fields said did not address intervention in currency valuations by trading partners. “As an industry we’re excited about working together with the president,” he said.
Barra said there was a “huge opportunity” to work together with the government to “improve the environment, improve safety and improve the jobs creation.”
Trump met Monday with prominent American manufacturers including Fields and Elon Musk, the head of Tesla Motors Inc., and said he would dramatically cut regulations and corporate taxes. Trump said manufacturers would face tough penalties if they move production outside the country.
“We think we can cut regulations by 75 percent. Maybe more,” Trump said. “When you want to expand your plant, or when Mark wants to come in and build a big massive plant, or when Dell wants to come in and do something monstrous and special — you’re going to have your approvals really fast.”
After the meeting, Fields said he was confident Trump was “very serious on making sure the United States economy is going to be strong and have policies — on tax, regulatory or trade — to drive that.”
Trump has openly agitated for U.S. automakers to keep jobs in the U.S. and cancel plans to build plants abroad.
“Car companies and others, if they want to do business in our country, have to start making things here again. WIN!” Trump tweeted last Sunday.
GM CEO Mary Barra, in a statement, said it was a “very constructive and wide-ranging discussion about how we can work together on policies that support a strong and competitive economy and auto industry, one that supports the environment and safety.
“The U.S. is our home market and we are eager to come together to reinvigorate U.S. manufacturing. We all want a vibrant U.S. manufacturing base that is competitive globally and that grows jobs. It’s good for our employees, our dealers, our suppliers and our customers.”
Fiat Chrysler CEO Marchionne, in a statement, said: “I appreciate the President’s focus on making the U.S. a great place to do business. We look forward to working with President Trump and members of Congress to strengthen American manufacturing.”
He said, in total, FCA has committed investments of more than $9.6 billion in its U.S. manufacturing facilities and created 25,000 new jobs to date since 2009.
With flattening U.S. auto sales and some excess capacity, U.S. automakers may be reluctant to agree to open new plants, which likely would not come online for several years. Meanwhile, while automakers are adding U.S. jobs they are also cutting U.S. small car production. On Monday, GM ended two shifts of production of small cars in Ohio and Michigan, cutting about 2,000 jobs.
Automakers have made good progress increasing fuel economy, but as I told a recent caller, the car companies have done all the easy things to get better fuel-efficiency, but from this point on, big leaps are going to be difficult, at best, especially with America’s love affair with trucks and SUVs.
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