Does Trump want to drive German cars out of America?


Does Trump want to drive German cars out of America?

US President, Donald Trump has threatened to slap heavy tariffs on imported cars.

Trump has asked the US Commerce Secretary, Wilbur Ross to take a look at the importing of cars into America, including trucks and automotive parts.

Trump is under the impression that foreign cars coming into the United States is a threat to U.S. national security.

This dramatic move has prompted an outcry from U.S. lawmakers as well as the foreign car manufacturers with the effect being investors selling their shares in the big European car makers. As a result, both BMW and Daimler dropped more than 3 percent in European trading after this news broke.

President Donald Trump seeming told the French President Emmanuel Macron that he wants German carmakers out of the U.S. altogether.

Trump knows that the German automakers and their businesses dominate the U.S. luxury car market. In 2017, Mercedes had about 17 per cent of this market, BMW had 15 per cent (about tied with Toyota Lexus) and Audi had 11 per cent, according to Statista.

The German car manufacturers are also major U.S. job creators employing 36,500 U.S. workers directly and another 80,000 workers from suppliers.

German car companies export about 430,000 vehicles from U.S. factories to the rest of the world. They sold some 1.35 million cars, SUVs and trucks in the U.S. in 2017.

BMW's Spartanburg, South Carolina, plant produced more than 371,000 BMW X3, X4, X5 and X6 models in 2017, according to a BMW annual company report. BMW says the factory employs more than 10,000 people.

Mercedes-Benz, a brand of Daimler, made more than 286,000 vehicles at its Tuscaloosa, Alabama, plant in 2017, according to the company's website. The plant employs more than 3,700 workers. More than 70 per cent of the plant's SUVs are exported to 135 countries, making it the second-largest automotive exporter in the U.S., according to the company.

Mercedes last year announced plans for a $1 billion investment to start production of electric passenger cars there over the next decade. Volkswagen's luxury brands include Audi, Bentley, Bugatti, Lamborghini and Porsche. VW's Chattanooga, Tennessee, plant makes Volkswagen's Passat model. That plant employs about 3,400 workers. The company is also planning an electric vehicle investment there.