Howes: Automakers see opportunity in Trump’s Washington

Daniel Howes
The Detroit News

Ford Motor Co. CEO Mark Fields says the automaker’s brass is in “constant communication” with Team Trump. I’ll bet they are.

Not since President Barack Obama doubled down on his predecessor’s rescue of the Detroit auto industry has it been so important for the U.S.-based global automakers to stay close to the president-elect. Donald Trump owes his victory partly to the folks on the factory floor, and to his willingness to hector the Blue Oval over its plans to ship small-car production to Mexico.

Still, his professed intention to cut corporate taxes, to enforce penalties in trade agreements, to reform health care and to expose currency manipulation is veritable music to auto industry ears. For the first time in more than a generation, a president-elect is voicing attention to the kind of issues that can affect the industry’s competitive posture.

All of it spells opportunity. Ford knows it; General Motors Co. knows it; and Fiat Chrysler Automobiles NV knows it. So does the United Auto Workers, whose leadership officially backed Hillary Clinton — even if a fairly decent chunk of its membership did not.

Trump’s campaign bluster, a frequent irritation to Ford, is less direct behind the scenes. In discussions with the company, the president-elect’s team is said to be less interested in using environmental politics to shape answers to critical automotive issues. In a radio interview with WJR’s Frank Beckmann, Trump praised Executive Chairman Bill Ford Jr. and cited the company’s burdens with corporate taxes and regulation.

“Bill Ford is a terrific person,” Trump told Beckmann on Election Day. “We did meet. We talked about a lot of things. But the fact is ... Ford is moving their small-car production out of Michigan ... to Mexico. Now, that’s bad. There are things we can do to keep that.”

In Trump, the automakers and the union have a would-be advocate for American manufacturing and American jobs whose advocacy could be very different from that of Obama. The Democratic incumbent’s undeniable willingness to execute a taxpayer-funded rescue of this town’s industry is offset by a long record of politicized rule making unmoored from technical and market reality.

Trump is said to be keenly aware of industry concerns about alleged currency manipulation, chiefly by Asian rivals; willing, like President Ronald Reagan, to enforce penalties for trade violations; sympathetic to using data — not politics — to set federal fuel-economy rules.

It’s hard to overstate the importance a regulatory shift like that would mean for the auto industry. For way too many years, partisan politics (usually of the center-left variety) routinely fueled Washington’s automotive policy-making, including the 2009 bailouts generally opposed by congressional Republicans.

The single biggest goal: trying to get someone else to pay for the sins of others. Why hammer consumers with higher federal gas taxes to reduce consumption when the feds can foist tougher standards (and higher costs) on the automakers?

Why risk exacerbating regional tensions with trifling objections to central bank management of national currency? Why use Treasury dollars to fund bailouts of GM and Chrysler when private capital could do the job — even if there was, by almost all accounts, no private capital available amid the global financial meltdown?

“All rhetoric aside,” the Trump transition team “has been very open to us,” says a ranking auto industry executive close to the situation. Trump “has a chance to get back to a winning formula on trade that could attract key industrial states into the fold.

“He’s got the right framework. Ending cheating (in trade deals) is going to help us tremendously. It’s a big difference.”

It could be, anyway. Trump threatens to upend the status quo that experienced the long, slow decline of the 2000s, lived the horror of bailouts and bankruptcy, rode the steady return to profitability and product excellence, and is making bets on the mobility space crowded with its Silicon Valley rivals.

Trump’s transition team is getting a lot of attention for how it’s not mirroring the sober processes of its predecessors. Justified or not, it doesn’t obscure a read by this town that the set of economic and trade policies likely to come from a Trump White House and a solidly Republican Congress could be a big improvement for automakers no longer fighting for their survival.

Whether it is remains to be seen.


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Daniel Howes’ column runs Tuesdays, Thursdays and Fridays. Follow him on Twitter @DanielHowes_TDN, listen to his Saturday podcasts, or catch him 3 and 10 p.m. Thursdays on Michigan Radio’s “Stateside,” 91.7 FM.