SiriusXM host Doron Levin weighing in on President Trump’s comments – during his State of the Union address – on Detroit and the auto industry.
“…State of the Union message from President Donald Trump and he did take the time to make a shout out to Detroit and to the auto industry.
I think we should talk about it because he did say in his speech that because of him the country was building and expanding auto plants, something that we haven’t seen in decades. That was one of his assertions.
He also said that very soon auto plants were going to be opening all over because of him.
With the President you always have to fact-check what he said. Afterwards he said that this was the biggest audience that had ever heard a State of the Union address and, of course, that wasn’t true but, we have to fact-check this stuff about the auto industry too. It turns out that while he does want to take credit for this there’s some good and there’s some bad.
The good is that it is true that we have had a big boom in the stock market and in personal wealth since he came into office. I don’t how much that can hang on him but it’s going to be that we can buy more cars, probably.
And that people are feeling optimistic and that’s going to be very good for the car makers. And I love it when the car makers are doing well because it means they can invest more in new models and we can get more features. And the whole mobility scene gets better because people are feeling confident and buying new vehicles so, that’s very good news.
As far as the assertion, that we’re now going to have a bunch of new car plants because of him let’s look at that.
In the last 20 years, and this is mostly when he’s not been President, global car makers have actually invested 75 billion dollars in the United States. What we need to understand is that the United States is a very good place to not only to build vehicles but also to export vehicles that’s because this is a very profitable market, it’s because we have very favorable trade agreements and I hope that doesn’t get messed up with the North American Free Trade Agreement being renegotiated in a way that isn’t advantageous to us. President Trump has said that he’s going to re-negotiate that and that has to be done carefully because that has worked out for us.
We have a new Volvo plant coming soon to South Carolina; a new Mercedes Benz plant in Alabama; we have additions coming to the BMW plant in South Carolina; Toyota and Mazda are going to build a new plant in Alabama; and even Chrysler is going to bring back some of its truck production from Mexico to Michigan, which is good news for the UAW and good news for the Michigan economy.
So, yes, the place is great for building vehicles and I think the Presdient was right to highlight that stuff but, we can’t say that it’s basically because of him. It’s been happening, actually a trend, a long-term trend, long before he even announced he was going to run for President so, let’s put that in some kind of perspective.
The important thing about this truck deal that Chrysler has now in Michigan is that it’s really being done as a hedge against the possibility that trade agreements that made it advantageous to build trucks in Mexico and bring them back to the United States may change. And if that changes then Chrysler needs to be building those trucks in the United States and it’s important for the administration not to mess up trade rules.
Now, I know a lot of you tune in to this show to hear about cars but, part of hearing about cars is also hearing about how they’re built, where they’re built, why they’re exported to where they are, and why they’re imported to where they are and a lot of that has to do with the trade rules. So, we look forward to all of that being negotiated in a way that’s advantegous to us in the United States and I think that that’s going to happen.
I don’t foresee that the North American Free Trade Agreement or some of the other agreements that allow cars and trucks to be built in Canada, United States, and Mexico and parts built in those places that allow them to go across the borders more or less without tariff I don’t foresee that changing. One thing that might happen, that the administration may do, and this is why no one really wants to contradict the President on this and get him upset, is a rethinking of some of the stricter fuel-efficiency rules and that could mean that we could see, soon, a relaxation which the auto makers would like, because they don’t want to bring in electric vehicles more quickly than people actually want to drive them.”
SiriusXM’s “In The Driver’s Seat with Doron Levin” airs every Saturday at 12:00pm ET on SiriusXM Insight channel 121.