President Trump is finally heading to China for his long-awaited series of trade talks with Chinese President Xi Jinping. The White House has made it clear that the automotive sector is mostly off the table at these talks. That doesn’t seem to be placating the automotive industry.
Today’s installment of The Morning Dump is all about what could happen, starting with how China’s vast car industry could interact with America’s car production. The concept of partnerships between the two countries on cars is sensitive, although Ford is soon to open its first plant with Chinese technology in the US very soon, so it’s possible.
The concept of tariffs was that automakers would start opening up more plants in the United States, which is slowly happening. Very slowly. So far only a handful of cars have actually switched as everyone waits to see what happens with the USMCA.
While carmakers worry about the threat of Chinese technology, one automaker in the US can’t even have employees at work due to failing infrastructure. How’s that for dichotomy?
Will The President Go Wildcard?
One of the best, most chaotic characters in all of narrative history is Charlie from It’s Always Sunny in Philadelphia. He’s a Don Quixote romantic with a Puckish charm and, likely, some of Gritty’s DNA. Charlie is also a “wildcard” as seen in the clip above. He’s willing to cut the brakes of the van he’s currently in so that he can fulfill a mission that’s usually only comprehensible to him.
It makes for great television, mostly because it creates ceaseless misfortune for everyone in his immediate universe. Whatever your politics, it’s undeniable the current President has a certain wildcard aspect to him, and carmakers seem very concerned that’s going to come into play when he’s in China this week.
Reuters has a good summation under the headline “US industry, lawmakers worried Trump will open US to Chinese autos,” that mentions President Trump is one of the few individuals with any power who seems excited about the prospect of Chinese automakers opening up plants in the US.
The White House has been explicit that cars aren’t going to be discussed, so what’s the concern?
U.S. Trade Representative Jamieson Greer said in Detroit in April that there were no plans to change the connected car rule, and that autos were not on the agenda at the Beijing summit. Commerce Secretary Howard Lutnick also has ruled out Chinese investments in the U.S. autos sector.
But Scott Paul, president of the Alliance for American Manufacturing, a domestic industries group, said there is a strong concern that Trump, who often talks of attracting more auto assembly plants to the U.S., could act alone.
“He’s left wiggle room in dealing with the auto sector,” Paul said.
Any plant approved would take two-to-three years to launch production, leaving consequences to Trump’s successor.
The US might not be have all the cards as it approaches the talks. Some in China view the US as an empire in decline, as the New York Times reports:
In January, a nationalistic Beijing think tank affiliated with Renmin University published a triumphant report about Mr. Trump’s first year back in office. The report argued that his tariffs, attacks on allies, anti-immigration policies and assaults on the American political establishment had inadvertently strengthened China while weakening the United States. Its title: “Thank Trump.”
That report comes with its own agenda, but it’s true that China has become less reliant on US exports and has used the trade war to expand elsewhere, as Nikkei Asia points out:
In the first four months of this year, the U.S. accounted for just 10% of China’s total exports, according to Chinese customs data. That is down from 18.4% in 2016, before Trump ramped up tariffs against China during his first term.
“The reality is China is no longer exporting to the U.S. directly because it has built up supply chains in other countries,” said Raymond Yeung, chief economist for greater China at ANZ. “For China, the overall U.S. trade policy against the world matters more than direct tariffs. If the U.S. imposes tariffs on Vietnam, Indonesia or India, it may indirectly impact China.”
Of course, the other side of this is that some people want Chinese cars here, and there’s been a concerted effort by Chinese brands to court American buyers. Could a president in search of a win sell out an entire sector? That’s the concern of the week.
Right now, the only Chinese-owned and automotive-adjacent factory is a small facility in California building BYD buses, although another one is almost done…
Ford’s Plant With Chinese Tech Is Ready To Open
The BlueOval Battery Park Michigan in the small town of Marshall is finally ready to start making batteries after years of drama. What was the issue? The plant, though not owned by a Chinese company, will use battery technology sourced from one. Specifically, the plant will use LFP chemistry licensed from CATL, the largest battery company in the world.
Just so you don’t think that President Trump is the only person willing to make an industrial deal with a Chinese firm, this project has its roots in the Biden Era plan to create green jobs and lessen our dependence on oil which, given that gas prices have been so low for so long, seems silly.
I’m kidding. Gas is expensive AF.
As Bloomberg explains, the whole concept of this was both necessary and designed to not freak people out:
Ford’s venture with CATL is structured to allay concerns. The US carmaker owns the plant, land and equipment and hires the workers. CATL, which holds no equity, offers lithium iron phosphate battery chemistry under a licensing agreement, and dispatches Chinese engineers to train Ford employees. It’s an arrangement with echoes of the deal that allowed Chinese social media app TikTok to remain operational in America, after ByteDance Ltd. agreed to license its prized algorithm to a new US-based entity.
Both sides have reason to like this setup. Use of CATL batteries by US automakers could help them become the industry standard, and boost market share. TikTok’s technology was seen as carrying security risks, but CATL’s CEO Robin Zeng has joked his battery cells are “dumb as bricks” — i.e. no use for espionage or any other unintended purpose.
Those batteries will be used, at least partially, to supply energy to the new $30,000 electric Ford truck. The rest are planned to be used for the company’s new energy storage business that’s been organized under the name Ford Energy.
While there are other companies with LFP patents, a Ford exec told reporters it would have taken a decade to catch up without the CATL tech.
Everyone Is Concerned About The USMCA
Once automakers have an answer on what’s going to happen with China, they can move back to the more immediate threat of what’s going to happen to the United States-Mexico-Canada Agreement (USMCA), created by President Trump in his first term, that underpins a huge amount of cross-border trade.
For all the pulling of hair and gnashing of teeth about the tariffs, most homegrown American automakers have been able to get by okay because the USMCA is still in place. It’s under review and it’s making people nervous.
It’s fairly clear at this point that President Trump would prefer every car sold in America is built in America, but so far only five models can be said to have been switched because of tariffs, and those changes are still in progress.
More so than just cars, the supply chains are also important, and all this uncertainty is hard for everyone.
Car manufacturers plan production five to seven years in advance, making it extremely difficult or even impossible for them to move quickly, said Jennifer Safavian, CEO of Autos Drive America, which represents foreign automakers in the U.S. And automotive supply chains are extremely complex, further complicating efforts to move production, she said.
“It’s hard for them to upend whatever plans they have,” Safavian said. “That’s why more certainty is important for the auto industry.”
[…]
“There are certain supply chains that have been built up over years and years that may not make sense [to have in the U.S.], which is why we have an agreement like USMCA,” said Collin Shaw, president of MEMA Original Equipment Suppliers, which represents U.S. suppliers.
What happens with the USMCA is anyone’s guess at this point.
Stellantis Employees Have To Work At Home Due To Water Main Break
Not helping with the whole “America is an empire in decline” narrative is the fact that the North American HQ of Stellantis can’t host employees because of a massive water main break in Orion Township that’s screwing with the water supply.
Being able to work at the HQ is an ongoing issue, as the Detroit Free Press reports:
The water main break is the latest hurdle for automaker employees working from the North American home office.
Stellantis ordered white collar employees in January to return to work five days a week after years of work from home policies stemming from the coronavirus pandemic period.
But since that period began at the end of March, employees have complained about parking citations as well as mysterious illnesses stemming from the older building.
Oof.
What I’m Listening To While Writing TMD
I had a dream last night about the upcoming Member’s Only track day at Lime Rock Park. Basically, I forgot to tell catering how many people were showing up and so all of a sudden I had to beg them to make a lot of sandwiches. As we were driving around in some sort of van (VW Transporter?), Nick told me not to worry and put in a tape of Bachman-Turner Overdrive. I don’t remember the song, but let’s assume it “You Ain’t Seen Nothing Yet.”
The Big Question
Would you buy an American-built, Chinese-branded car?
Top photo: BYD
You can substitute nearly every country on earth here with that statement.
I just spent two weeks and some change in Northern Europe and it is shocking how behind the US is with regard to cars. I knew it to be the case on paper but seeing it in person was staggering. Probably half or more of the vehicles I saw were EVs and the Chinese companies had dealerships in most of the major cities I was in…and I’ve got to say, the cars don’t exactly look shabby either.
Pretty much every new-ish car was an EV…and before the anti EV crowd gets too revved up I will acknowledge that the infrastructure is very different, the needs of drivers are very different, etc…but there were almost no American cars outside of vans (usually electric) and the small hatchbacks that Ford still sells over there.
I understand that the American manufacturers don’t want to do anything but sell Americans massive trucks on absurd loans and that nothing matters other than the next earnings call…but holy shit. We are going to be irrelevant in most first world markets within the next decade, and Chinese EVs are one of the main reasons.
I don’t know if there’s anything that can be done at this point, either. Really the only way to compete was for the gubment to stack the deck and for the manufacturers to go all in on EVs many years ago. Instead we made EVs culture war red meat and quadrupled down on our own bullshit, as Americans do.
The BUT MUHHHHH V8 crowd is enjoying their victory laps right now but boy they’re not going to be celebrating in a few years, and again in proud American tradition everyone is going to be standing around screaming “we couldn’t have possible seen this coming!!!!” and begging for some socialism to get them out of the pickle….
Exactly. Piggies always enjoy rolling around in their own filth, thinking it means something and they can’t be convinced otherwise.
I’m sure that The Man With A Seat Cushion For A Brain will assiduously follow through on any auto-industry discussion with Xi.
I currently drive a chinese-built swedish-branded car, so… I guess.
I just spent a few weeks in Mexico and Chinese cars were everywhere. BYD, GWM, Geely and several others. The only one I rode in was a Geely and it was pretty nice. I can’t say that I would buy one simply due to service and parts availability, but I see no reason why we shouldn’t allow buyers the choice to purchase one here.
TBQ: Only if it was union made. American car companies had decades to get their head out their ass and be competitive and instead of hiring more engineers, they hired more lawyers to weasel out of actually innovating. As long as workers still have good paying jobs, the billionaire profiting is irrelevant
Isn’t all this China car nonsense really just Japan car nonsense all over again? Didn’t domestic auto makers just sell “captive imports” for 20 years? Just import and rebadge, or build on license like people have forever. It’s fine. There is nothing special about US automakers. They are the same as any other. If they don’t have good ideas, then pay for some.
Given the words shared when Carney opened up the Canadian market to Chinese cars, I assume that trump believes each car with a tie to China also has a small Democrat hanging out in the trunk.
(Side note – the cars have started showing up here! It’s exciting to see the big old middle finger in action)
I’d expect the conversations to be around AI, Data centers, chipsets and chicken balls.
Taking pictures, and writing back home all the state secrets.
It’s a modern rendition of the red scare.
I wouldn’t buy a Chinese car no matter where it is built. Zero interest in what they are putting out. The chances of them making anything I have the slightest interest in is roughly the same as my getting on a flight to Mars. And that is before getting into the geopolitics of it. The upper class screwed the rest of us to make a buck already. I don’t feel a need to help with that. Bad enough that in so many cases I literally have no choice. But I sure do in cars.
The list of American-designed cars I have any interest in is *extremely* short too. Technically, I have bought one “American-owned” car new, but it was a Saab 9-3SC… And of 40+ cars owned, one actually American car, a Jeep.
And that water break will take around 2 weeks if they are lucky. It sucks for people living in the area. I remember when my pipes froze in my previous home (they didnt burst luckily) and not having running water for a day what a pain…
States here before own a Polestar 2 so already own a Chinese built car. So to me it all matters on if it is a deal or not and if they are actually reliable good cars. Nothing they have over there strikes my fancy from their brands. Really wish the new Jimny’s were here but at this point just waiting for the R3X and Scouts (if VW doesn’t cancel them)
I really, really, really hope that R3X gets made and still looks like the concept.
Ditto. I wanted to go the ioniq 5 but size wise it is almost small minivan or CUV vs sedan/hot hatch.
My rural conservative family nearly disowned us 26 years ago when we bought a Hyundai. Well modern politics has now had them disown us completely so…
Yes I would if met our needs and was affordable with a good warranty.
I just brokered the most greatest deal with Jyna! President Xi was a tough negotiator but I forced their hand and they had no choice. Many said it could not be done, but not me. I always knew I’d bring back a deal like no other, quite frankly. A five-star general came to me after the deal was signed, tears in his eyes – very attactive General actually, big broad shoulders, nice blond hair and blue eyes – and he says to me “Mr. President… I never thought a deal like this could be achieved.” Which is a word, by all accounts; I was told “achieved” is a word; no really, look it up. Maybe it’s a word invented by Democrats, you never know. Like that “affordabilty” hoax, but what they weren’t counting with is that I’m actually the best at affordability. Practically grew up affording things, it runs in my family. That’s why, effective immediate, all chinese automakers are now free to do their business in the USA – President Xi guarantees they’re affordable! Not only that, I just saved our automakers a ton of money, a TON of money! They’ll no longer be selling cars in Jyna, can you imagine how much they’ll save on all the cars they won’t have to make? Costs a pretty penny to make a car, trust me. When you save money like that you get more affordability – not many people know that, but I do. My uncle was an MIT professor, and he always afforded things too, so I learned how to afford with a literal MIT genius who was my uncle. But the Democrats, oh my god. Horrible, horrible people, all of them quite frankly, the true cancer destroying America with votes from illegal aliens. Their affordability hoax is going nowhere, I tell ya.
FANTASTIC!!
You missed “like nobody as ever seen before”
Nailed it. It’s like you are clairvoyant or something.
There is someone I would like thrown under a bus while in China, but it’s not the US automakers.
Thank you for your attention to this matter.
Dude, you read minds?
I guess we all expect the same from Trump at this point, and it’s always the worst case scenario for American people.
Problem with being able to read minds is all the blank media out there.
Works wonders for propagandists.
An upvote isn’t enough for how beautifully and effectively you turned my stomach. The “affordability”/”afforded things” leitmotif is masterful.
Haha thanks! I guess we’ve been so bombarded with Trump’s “weave” for the past decade, anyone could really come up with something similar if they had a couple of minutes to kill like I had 🙂
“He pronounces ‘China’ like a toddler who just learned the name for her genitals”
-Seth Meyers
Not sure about a Chinese car but I’m currently shopping for a UTV. For the price and features I want I can either get a Chinese built CFmoto that is only a few years old, or I can get a Polaris that is much older. Decisions, decisions…
Have you also looked into Mahindra or Kymco? If there are any dealers local that is. Not sure exactly what you are looking for though.
Gigantic LOL at the “THERES ONLY ONE WAGONEER S” banner because you can make your own mad-libs addendum to it. Only one… “model year”, or “Sold this month”, or “We think, nobody knows what Wagoneer is anymore.” Stellantis didn’t understand the concept of home-field advantage and decided to go crazy scoring own-goals.
There can be only one.
I would be more likely to buy a Chinese car built here than an American car built there, but not very likely to buy either.
I hope to never have to do to buy a Chinese made car. I also hope that there’s a competitively priced American made option.
One day we’ll wake up to what the Koreans and the Chinese are doing and try and compete on price without government intervention making foreign products higher priced.
We already buy so much Chinese stuff on Amazon and Temu most of the car buying public won’t even blink at it.
We already have Chinese-built American branded cars, so why not an American-made Chinese name car?
BTO, now that brings back memories, thanks Matt
“That’s BTO. They were Canada’s answer to ELP. Their biggest hit was TCB. That was how we talked in the seventies. We didn’t have a moment to spare.”
Today some colleagues were having a meeting with Australia and I took advantage to reference the classic globe, Australia and Rand McNally moment.
“It was the LSD.”
Would you buy an American-built, Chinese-branded car?
Absolutely, liking that it’s local labor getting the work, preferably unionized. We live in a global economy, so it makes sense to source materials and design where practical.
China already has a variety of proper E-REVs that the US market is lacking. Build fully electric E–REV sedans, small hatches, a minivan and CUVs. Give the skateboard a large enough battery to go ~80 miles (or more) on an overnight (120v) charge, and drop in an efficient purpose-built range extender/generator happy meal with enough of a gas tank to go another 400 miles and you’ve got a winner. Go with 48v wiring, all the safety nannies, and real physical controls and buttons. Build it with 1-motor and 2-motor (AWD) options then just watch the orders roll in. If US manufacturers won’t do it, China is welcome to come in (see Mazda 6e and CX6e as examples, and drool over the Mazda Vision and Mazda Ionic concept cars)
We DON’T need another big-ass 3-row SUV or pickup E-REV. The upcoming F-150 E-REV, RAM E-REV and SCOUT E-REV are all targeting the AWD large vehicle / adventure market. We need practical, efficient, small, fast, fun EREVS for the rest of us.
I for one, welcome our Chinese E-REV overlords.
We drive two American-built, Japanese-branded cars now, and I just verified that our American-branded truck was built in Kentucky. Bring on the E-REV 1/4T pickups plz.
TBQ: no, mainly because I live in Europe. But I wouldn’t mind buying a Chinese car in general. If they are good, it doesn’t matter where they are coming from.
Also the article title: “ The Auto Industry Is Hoping The President Doesn’t Throw Them Under The Bus In China”. Or crushed their dreams?
Would you buy an American-built, Chinese-branded car?
No. I’m not going to come up with a rationale. I just don’t want to buy a Chinese-branded car, even if I don’t care that damn near everything else I own was made in China.
Would you buy a Chinese-built, American-branded car?
Maybe? I would prefer one not built in China, but I suspect at least some parts of my American-branded vehicles ostensibly built here were made in China, so I’m less bothered by this.
To me, driving a Chinese-branded vehicle feels like I would be outwardly supporting China. I don’t have a problem with China in general, but they are the biggest rival of the US and they appear to play with a looser set of rules than on international trade than the West.
Driving a Chinese-branded vehicle in 2026 America to me seems like driving a Soviet-branded vehicle in America during the Cold War. I wouldn’t have driven a Lada Niva in the ’70s or ’80s, although I would love to own a Lada Niva today.
With the worry about the catering in your dream, I would have thought the song would be Takin’ Care of Business with the misheard lyrics “Bakin’ carrot biscuits”.
Why is everybody concerned about the the United States Marine Corp? What’s with it? Are they being mistreated? Better not be. What? the USMCA, not the USMC? Oh, that’s different then, never mind.
From the Halls of Hermosillo to the shores of Ontario…
Maybe it’s like the YMCA…
Think I’m showing my age here. Google Emily Litella.