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“If China wants to come and build a car factory here, I won’t be against it,” Trump said on Fox News. The President made it clear separately that he does not want another scenario: for Chinese companies to build cars in Mexico with a view to subsequently supplying them to the US, writes Carscoops.
For Detroit, Trump’s proposal is a blow to the industry’s own position. The Alliance for Automotive Innovation, representing the largest manufacturers, called on Congress in early September to impose a permanent ban on the sale, import and manufacture of Chinese cars, equipment and software for connected vehicles. The industry views the Beijing-subsidised automotive sector as a threat to the US economy and national security.
Chinese brands are already virtually cut off from the US market. Rules adopted under the Joe Biden administration restrict the use in connected cars of equipment and software from companies with links to China or Russia. High tariffs are creating an additional barrier to imports. In July, a Senate committee backed a further tightening of these restrictions.
That said, this is not the first time Trump has offered the Chinese an alternative path — not to export cars to the US, but to invest directly in American manufacturing. The President cites the Japanese example: Toyota, Honda and other Asian brands have long been manufacturing cars in the US and creating jobs there.
The paradox is that Washington is simultaneously putting pressure on American companies for cooperating with Chinese businesses. The Trump administration has criticised Ford for its partnership with CATL and other Chinese companies, whilst Ford’s CEO Jim Farley himself describes the Chinese car industry as a serious competitive threat to the American sector.
In effect, Trump is offering Chinese companies a deal: an American factory and American workers in exchange for a chance to break into one of the world’s largest car markets. But for now, Congress is moving in the opposite direction.
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