President Trump told leaders of the country’s largest automakers Tuesday that he will curtail “unnecessary” environmental regulations and make it easier to build plants in the U.S., changes that he expects will shore up the manufacturing jobs he repeatedly promised to voters on the campaign trail.
After weeks of taunting the automotive industry over Twitter, Trump made a point to meet with the CEOs of General Motors, Ford and Fiat Chrysler just days into his term. He has pressured the companies to build more vehicles in the U.S. and hire more Americans into manufacturing jobs.
“We have a very big push on to have auto plants and other plants, many other plants, you’re not being singled out … to have a lot of plants from a lot of different items built in the United States,” Trump told executives Tuesday. “It’s happening. It’s happening, bigly.”
But Trump’s efforts to increase U.S. auto manufacturing may require more than changes to environmental regulations or permits, said Kristin Dziczek, director of the industry, labor and economics group at the Center for Automotive Research.
Economics still favor building plants and hiring workers in Mexico, where labor is less expensive and there are fewer trade barriers. What’s more, Dziczek said the big automakers make investments knowing they will outlive any single president, regardless of what policies or regulations are put in place.
“This industry has been around for 100 years, and plants last for 40 or 50 years or more,” Dziczek said. “They can’t be swerving left and right every time there is a political change.”
Chief executives Mary Barra of General Motors, Mark Fields of Ford and Sergio Marchionne of Fiat Chrysler attended the meeting, along with other top executives from their companies.
Will be meeting at 9:00 with top automobile executives concerning jobs in America. I want new plants to be built here for cars sold here!
— Donald J. Trump (@realDonaldTrump) January 24, 2017
President Trump told the chief executives that environmental regulations are “out of control” and his administration will focus on “real regulations that mean something” while eliminating those that he finds inhospitable to business.
“I am, to a large extent, an environmentalist. I believe in it, but it’s out of control,” Trump said.
Executives declined to answer questions after the meeting, including whether the president cited any specific regulations he would cut. Only a portion of Tuesday’s gathering was open to the press.
The industry contends that complying with increasingly stringent fuel economy standards increases the cost of making cars, which must then be passed on to buyers or compensated for with job cuts. Those regulations were introduced after the Obama administration rescued GM and Chrysler during the financial downturn and were upheld by the Environmental Protection Agency two weeks ago.
Safe Climate Campaign Director Daniel Becker said job creation doesn’t need to come at the expense of regulations that have a positive impact on the environment. The fuel economy standards, in particular, help to save the consumers money at the gas pump and reduce the country’s dependence on oil, he said.
“Despite the rhetoric there is often reason behind regulations, and in this case there is overwhelming evidence of how beneficial they are for consumers, the industry and overall Americans,” Becker said.
Analysts have speculated that Trump could ease those regulations or others that impact the industry as a reward for companies creating more jobs in the U.S. Trump has also pledged to reduce corporate taxes, a move that would surely please executives.
“There is a huge opportunity working together as an industry with government that we can improve the environment, improve safety, and improve jobs creation and the competiveness of manufacturing,” Barra told reports after the meeting.
Fields told reporters that Trump’s decision Monday to withdraw from the Trans-Pacific Partnership, a largely symbolic move since the deal was unlikely to pass Congress, was a sign of his desire to implement policies that improve competitiveness and “create a renaissance in American manufacturing.”
“We have been very vocal both as an industry and as a company and we have repeatedly said that the mother of all trade barriers is currency manipulation,” Fields said. “TPP failed in meaningfully dealing with that and we appreciate the president’s courage to walk away from a bad trade deal.”
Vice President Pence, Chief Strategist Steve Bannon, Chief of Staff Reince Priebus and senior adviser Jared Kushner also attended Tuesday’s meeting.
Though Trump spoke often on the campaign trail about the need to revive manufacturing across the economy, he narrowed in on the automotive industry in particular in the weeks following his election. He separately criticized Ford, GM and Toyota for plans to build certain cars in Mexico and then sell them in the U.S.
Trump threatened automotive companies that build abroad with a 35 percent tariff on goods imported to the U.S. for sale. Whether Trump has the power to impose such a tax on select companies has been called into question.
Conversely, Trump has also praised automakers who pledged to invest in the U.S. and add jobs here — often taking credit for those decisions even when companies said they had been in the works for months or years. This month alone, Ford, Fiat Chrysler, GM, Toyota and Hyundai pledged to spend billions of dollars in the U.S. over the next several years on new factories, expanded production and hiring.
Trump met Monday with business leaders from a smattering of industries, including Fields and Tesla chief executive Elon Musk. The president reportedly told executives that he intends to eliminate a majority regulations and “massively” cut corporate taxes, but that in return those companies must keep production in the U.S. and preserve American jobs.
The CEOs were told to devise a “series of actions” that will boost U.S. manufacturing and submit those plans to Trump within the next 30 days.
David Nakamura contributed to this report.
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