Donald Trump needs a briefing in the realities of the global auto market
Donald Trump’s showing no sign of easing up on his whacking of the auto industry.
His latest target is Toyota. Apparently Detroit’s automakers aren’t the only ones building cars in Mexico for sale in the United States.
So are Volkswagen and Audi and anyone else smart enough to realize the advantages. You know, the ones that start with Mexican trade deals giving these companies access to 60 percent of the world’s economic output.
Even the best deal maker on the planet cannot deliver that – not yet, anyway.
The president-elect’s so-called Build America campaign needs a slight rethink. Not because calling out the likes of General Motors or Ford Motor or Toyota for expanding in Mexico doesn’t resonate with voters. It does, especially around here.
The problem is the global auto industry isn’t wired to meet Trump’s demands.
Ford just killed plans to build a new plant in Mexico. But its Focus compact will still come from there. The company’s new Eco-Sport compact SUV will be built in India then imported to the U.S. GM’s Buick Envision is assembled in China and sold here. United Auto Workers President Dennis Williams calls it the “Invasion” which shows you how closely aligned the union is with the Republican president-elect.
We’re just getting warmed up. Fiat Chrysler’s new Jeep Renegade SUV is imported from Italy. Its Jeep Compass? From Mexico. And, its Pacifica minivan comes from Canada.
In fact, of all the vehicles shown by Detroit at the recent Los Angeles Auto Show, only one is being assembled in the United States. And yes, GM assembles its Chevy Cruze hatchbacks in Mexico, most of which are shipped outside the States.
Team Trump clearly has work to do. Toyota doesn’t only build in Mexico. Its compact CHR SUV hails from Turkey. Audi’s Q5 comes from - you guessed it - Mexico. So do VW’s Jetta, Golf, and Beetle. With the exception of the Michigan-built Chevy Sonic, all subcompacts sold in the U.S. come from foreign plants.
Renault-Nissan and Germany’s Daimler are following Audi to Mexico. They’re partnering to build luxury Mercedes and Infiniti vehicles there.
GM and Chrysler are expanding production. With the exception – so far – of Ford scuttling its Mexican plant, the trend is going south of the border not the other way around.
Earlier this week, Trump used Twitter to threaten GM with what he called a “big border tax” if it keeps building Cruzes in Mexico and shipping them into the States. Really? Without the approval of Congress, especially members whose districts include automakers that account for a heck of a lot of jobs?
I can hear the protests now.
The auto industry, foreign and domestic, has deep roots in communities across the country. It is planted in the industrial Midwest and the South, regions where voters generally backed Trump so he would help mend their economy, not hurt it.
Trump’s Twitter war on autos may win rhetorical points, but it’s a loser in the global auto industry of today. Unless his promised tax and regulatory reform become real, it still will be a loser.
Daniel Howes is a columnist at The Detroit News. Views expressed in his essays are his own and do not necessarily reflect those of Michigan Radio, its management or the station licensee, The University of Michigan.