President Donald Trump during a White House meeting with the chief executives of auto-makers urged them to pump in more investment into the US economy. The president promised to make investment more lucrative for these car companies through deductions in taxes and regulations. Mr. Trump met Mark Fields of Ford, and Sergio Marchionne of Fiat Chrysler and Mary Barra of General Motors to discuss the future investment scenario in the United States.
What’s pressing Trump?
Trump’s meeting with chief executives of three car giants was an attempt to promote his “buy American, hire American” policy. He reiterated his objective of bringing home jobs for Americans by encouraging automakers to manufacture vehicles in the US. The two issues pressing the president that caused him to call for this meeting are:
-Record high auto imports
43% of the total 17.55 million new vehicles bought by Americans last year were imported. Canada ships 10% and Mexico ships 10% of automobiles to the United States. Pressed by the numbers, Trump emphasized that automakers should bring back jobs to the US by investing in plants. However, the large car makers are not expected to move production to the US because costs are much lower in Mexico, but the tables will turn if Trump imposes the 35% import tax.
-Low auto jobs in the US
The economic collapse of the US in 2009 pushed the large three car makers to cut employment and close production plants in the country. Auto manufacturing jobs reached rock bottom at 623,500 by June 2009. Trump intends to increase blue-collar jobs in America by pushing car giants to invest in manufacturing plants in the US.
Contribution of US Automakers
In recent years, US automakers have been reluctant to set up new auto plants in the US, but they have increased operations at the existing plants; General Motors and Ford build new assembly plants in 2004, while Fiat Chrysler set up a new transmission plant in Indiana in the year 2014. The declining auto-sales in the US make automakers reluctant to establish new plants in the US. However, in the recent weeks, GM, Fiat Chrysler, Ford, and Toyota have announced several new investments and jobs in the US. Since 2009, they have collectively brought more than 78,000 jobs.
The meeting brought CEOs of three car giants and the US president together for the first time since 2011, when they met ex-president Barack Obama to strategize fuel efficiency by 2025, the mandates of which are urged to be changed by automakers.