German Carmakers Head to Washington, Hoping to Dodge Tariffs by Offering Jobs

Trump wants to slap tariffs on US Auto companies in Canada, but not on German made cars? It seems his Presidency is simply a side-line, part-time job where he can further his real job: his business dealings with German Banks, and erecting hotels in Russia and Saudi Arabia.

"Trump reassured..." And I'm pretty certain he will change his mind again tomorrow.

“Designed, engineered, and assembled in the USA.” A well-known appliance company slaps this label on its products. But what does it really mean? It essentially means that the high value components are built in low wage countries, and then imported into the U.S. for the lower value assembly operation. At the front end, the relatively smaller effort of design and engineering is also done in the U.S. This same strategy is being used by German auto makers. Reasonable people can disagree about this design and production strategy, but the problem is that reasonable people don’t have the facts. A possible solution would be for the Commerce Department to develop a uniform approach to defining the U.S. “content” in each product. It would be very similar to the content labels on food. Unlike food labels, however, it wouldn’t be mandatory. Hopefully, over time, producers would use the label for marketing purposes and it would become a de facto standard. The government can play an important role in helping consumers make fact-based decisions.

Like all cowards, Trump's MO is always bellicose in public as fodder for for his hateful base - including against foreign automakers - while being accommodating face to face with industry giants. Depending on this little needy man's mood, he'll contradict himself within a few hours or days, and the trade wars start all over again.

Someone must’ve informed Trump that there’s a huge BMW assembly plant in South Carolina, a fact he seemed utterly ignorant of before, as evidenced during one of his nationalist rallies in the state.

I would hope these business executives are intelligent enough to never trust a carnival barker, particularly our chief carnival barker. His words are meaningless, his actions are whimsical and he is not to be trusted. Just ask his former bankers, investors, contractors, suppliers, university students, airline and casino employees, and on and on. Yup. The Tariff Man is playing them.

"Yet Mr. Trump could ultimately call for the levies if he does not think Europe is negotiating a trade deal in good faith." This statement says it all. Trump doesn't know the meaning of negotiating in good faith. His negotiating skill consists of changing his position depending on whom he is speaking with at any given moment. This article reveals the complexities of building cars in the era of globalization. The CEOs tasked with juggling these complexities are head and shoulders above our clueless 'president ' who thinks he can order these people around. I'm betting that they will play Trump like a fiddle, tell him what he needs to hear to stroke his huge ego, give him his 'win' then go on with business as usual.

Love Trumps tactics. First he struck a separate deal with Mexico, which threw Canada under the bus. Canada was then forced to make concessions or be left out. They got played so badly by Trump that Trudeau looked like a hostage at the signing ceremony. Now Trump is bypassing the European Commission and the national governments to negotiate directly with automakers, who will fall over themselves to be the first to accommodate Trump and gain his favor. Same with Britain vis a vis the EU. He has taken “divide and conquer” to a whole new level.

But what will he say on Wednesday or Thursday. Trump's word is worthless.

In response to HKS who writes " I once owned a Ford made car that was assembled in Germany with an engine made in Brazil, a transmission from Japan, American and German electronics and riding on Italian branded tires that were made in Northern Ireland. " 6 out of the 7 countries you cite had wage levels comparable to the US. So the playing field was level. In today's world, cars are increasingly made in Countries such as China, that have 1/6th of the wages of the West, with Chinese parts, made by Chinese workers at 1/6th of US costs. No US auto worker can compete with this GM, that just announced layoffs is importing these cars into the US as upscale American Brands. Cadillacs, Buicks That IS a problem for US workers

President Trump threatens BMW, which has its largest assembly plant in South Carolina, with tariffs because he thinks it plays well with his "base". I would love to hear some of the private conversations among the foreign auto executives. I'm quite certain they discuss how long the simple-minded insanity personified by the Trump administration is likely to last, and how to maneuver until it passes.

Why would German auto makers believe Trump? They’re not fools.

2008- As part of the debate on whether to bail out struggling automakers, Mitch McConnell leads other Republicans in calls to lower the wages of unionized auto workers.

Trump has no understanding of the auto manufacturing industry. He thinks everything is made in one plant. BMW in Spartanburg has a bevy of tier two providers that contribute to the final product such as seat manufacturer, radio manufacturer etc. These manufacturers, along with BMW are the heart and soul of the local economy.

The Germans aren't stupid enough to believe anything Trump tells them. No country is. What's so amazing to me is how Trump isn't bothered by things like that. I couldn't deal with it if I knew that every time I said something to somebody they would be thinking: yeah, right.

Econ 101 Automobiles in Germany are made at higher wages than in the US, and with far more workers rights. By law, half of the corporate board must be labour representatives. No tariffs are needed. US worker can compete on a level playing field Automobiles made in China a made bey workers that earn 1/6th of US workers, and have no labour rights whatsoever. NO US autoworker can compete under those conditions. There tariffs are needed to level the playing field

The only assurance that DJT can issue is falsehood. Why would any country, organization, entity, or individual give one scintilla of credence to any of his utterances? You make your bed and you LIE in it.

Tesla shows that innovation is key After 25 years driving a BMW we have a Tesla nowThe war us on innovation and brains not tariffs But to understand this a brain is needed.

The meeting provided photo opportunities for president Trump so that he can project power and influence to other world leaders. But this game of negotiation will last as long as there is fear in their mind. My prediction is that German auto makers will lose in big time.

"President Trump on Tuesday reassured German auto executives that he had no immediate plans to impose tariffs on their cars" Sad that something like this, from the POTUS, is now called "reassurance". Immediate is now six tweets from now.

Nobody knows what the President’s decision is going to be... These guys did their homework well. Make the egomaniac feel important.

By abandoning those with the actual authority to negotiate on behalf of the US and rushing across the Atlantic in a panic to grovel in separate sessions, these executives gave Trump exactly what he wanted: attention and an audience. This kind of reliance on personal appeals and whim is not the basis for a stable relationship.

VW, Mercedes Benz and BMW already build cars in the USA in our own non-unionized third world states.

I hope the German auto makers understand that Trump is totally unstable and he will change his mind within 48 hours.

As fickle as he is, it only means no tariff tweets at least until tomorrow morning.

Given Trump's mode of pretty certainly reversing himself rather quickly, shorting Daimler, BMW and Volkswagen (VW) might be a smart move. If those execs are smart, they know not to rely on those pledges.

Thank goodness. I’m about to buy the fabulous Mercedes AMG GLE63 2019 soon for my Christmas present. Maybe settle for the AMG GLE43 with the smaller 385hp...German made engine, drive train.

Does it matter what trump says or promises? If anything, It’s only a good indicator of what’s not the case.

Trump is showing how ignorant he is!

I don’t understand. Does a President have the power, by himself, to impose and change and remove tariffs from any other country? How can this be? Must there not be oversight of these kinds of momentous policy changes by Congress?

Although Trump has decided to put a hold on the tariffs for now, with the heavy weight on deciding trade agreements currently, why is Trump focused on shifting car makers here in the U.S. through talk of tariffs? Until trade agreements are more certain, no company would want to commit to something without having some reassurance. Additionally, in regards to the tariffs, the government may be gaining money through tariffs, however as a country we are losing money because we are putting limitations on trade and inefficiency. There is a reason that manufacturers continue to have factories in other countries. It is likely more efficient to have it in other countries than all in America.

It doesn't sound like BMW, Daimler-Benz and Volkswagen are experiencing Fahrvergnügen.

Several auto manufacturing CEO's with an average IQ of about 135 will be meeting with a President with an IQ of about 88. Guess who's going to come out on top?

Like any bully, DJT likes to use threats. Like any bully, he wants to split a small group off from a main group, to increase his gang. Europeans, fortunately, are Europeans, not only carmakers.

There is no way that I would ever buy a car from people who went to war against the World twice.

"BMW, Daimler and Volkswagen already build hundreds of thousands of cars in Alabama, South Carolina, and Tennessee." A more precise sentence would speak not of "building" cars but rather the *final assembly* of the cars. Most of the major components and the labor for making the cars are imported. This is also true of iPhones built in China -- much of the high value components are imported to China with the final assembly which is of relatively low value performed in China. For example, the iPhone processor is made in Taiwan by TSMC and the OLED screen is made in Korea by Samsung. The problem with tariffs with German cars is and has been for some time the *asymmetry* of the tariffs. Trump is on record for advocating a policy of zero tariffs for both countries, but the Germans and/or the EU is not interested. They want to protect their own markets at America's expense. It is reasonable to have the same tariffs on German cars as they have on American cars. If Germany / EU truly want American business, they will have to stop taking advantage of this country. Instead of criticizing Trump for advocating what is only a fair policy, we should have criticizing Bush and Obama who preceded Trump for allowing this truly unfair condition to have gone along for so long. Since Trump won by the slimmest of margins in several manufacturing states, if Obama had passed such tariffs or if Clinton had strongly advocated for such tariffs then we might have had a Democrat as President.

European car makers are American car makers these days, too. BWI, VW and others have assembly plants here employing citizens are good wages, but lower than union wages. They want to be here to build cars closer to the second biggest market in the world and governments want them here paying taxes and employing people. Meanwhile, American companies shift work to Mexico and anywhere else they like to increase their profits. In point of fact, the car business has been international for a very long time, with Henry Ford leading the way in the early days of Ford Motors by setting up in Europe. The Ford Focus has been the best selling car in the world for years (not sure which car is on top at the moment).

Tesla and California are not in the Cons lexicon.

What is this hype about German cars?! Young black dude in Newark drives BMW or Audi. Mercedes is Yugo for them. By the way, I don't drive fancy car. Carbon based vehicle will be supplanted by renewable energy based vehicle and high speed mass transit. These present vehicles will have the same fate as coal.

So he will "force them" to do something they wanted to do anyway (build more of their NAFTA cars in NAFTA countries) and Trump will declare victory. The amazing thing is that it actually works with the Fox bots and Trump cult followers.

I have read several comments about cars and their manufacture from Times readers in articles like this over the years, and it still amazes me how some people “wouldn’t buy a foreign car”or the counterpoint argument that “American” cars are junk and they would only own a non US brand. Don’t they do the research and know that the “Japanese” Toyota they prefer, or that luxurious Mercedes SUV they proudly drive is likely made in someplace like Alabama, or Tennessee, or Mexico? Globalism has existed in auto making for some time, and a lot of American jobs are tied directly to foreign companies. I once owned a Ford made car that was assembled in Germany with an engine made in Brazil, a transmission from Japan, American and German electronics and riding on Italian branded tires that were made in Northern Ireland. It was sold in the US as a Mercury. Today, that VW, or Chevy, or Hyundai or whatever you drive probably has a similar story Tariffs hurt everyone, regardless of who gets targeted, so be careful what country or automaker you would I like to see punished. It might just impact your paycheck.

Years ago, I met a man in New Jersey and visited his home. In the wall of his study I noticed a picture of a German U Boat and the crew. He pointed himself out and I was impressed. I asked him what he did in the US and he said he was a Vice President of Volkswagen in New Jersey. Then I told him, you know if Germany had actually WON the war you would probably be doing the same job you are now doing - Vice President of Volkswagen in New Jersey. Now how about that?

Hmm. If I was an executive of an automobile manufacturing concern invited to the White House my suspicions would be raised. I would ask, to what end will my participation be used? Propaganda, berating via a tweet, use of my participation for self-aggrandizement? Would there be agreements, agreements that cannot be reneged on at a later time when their shelf life has expired (ya know, after the masses have cheered)? Given this administrations shoddy track record in anything they have attempted to accomplish I would be suspicious of their overtures. And still consider moving my operation to, well, Mexico or Ontario, CN. I hear there is a plant that will be vacated soon in Canada and also heard the people are friendly and their PM is well spoken.

After the NATO summit earlier this year, the outlines of a deal seemed clear. Germany would do three things: 1. Buy U.S. liquid natural gas 2. Increased automotive production in the U.S. 3. Buy one or more large U.S. weapons systems as part of its military buildup Recently, the German government agreed to finance the construction of a terminal to receive LNG from the U.S. and elsewhere. U.S. LNG is too expensive to become a large part of Germany’s energy mix, but it should gain a modest foothold. There is also a still small possibility with the change in leadership in the CDU/CSU that the Nordstream II natural gas pipeline might not be completed as planned, especially if Russia continues its aggression toward Ukraine. Now the German automakers are looking to increase their presence in the U.S. The last part of the deal will probably involve Germany buying the F35 as its next fighter jet and/or the King Stallion as its next heavy lift helicopter. In exchange for all of this, the U.S. won’t push Germany to meet its NATO commitment of 2% of GDP, which they never planned to do anyway, and may roll back the steel/aluminum tariffs on the EU, which Trump imposed to gain leverage in the negotiations. All in all, a modestly good deal for the U.S.

Instead of forming a unified coalition with our fellow democratic large -economy allies to confront China (either through the WTO or directly) on myriad legitimate grievances, Trump has chosen to lump our best friends in with our adversaries, in some instances treating the former even worse than the latter. There is only one logical explanation for this: Trump isn't really interested in "fixing" any trade issues, instead, he's carrying out the task given to him by Putin: destroy the postwar liberal democratic alliance. Occam's razor.

"BMW has said it could start building motors in the United States instead of importing them from Germany" If you have seen a modern engine assembly factory, it is largely an automated process. The components still come from Europe or Mexico but the assembly operation will help achieve both new North American content of 75% and 40% labor at $16 an hour. Electric cars have even less labor content. The typical gas engine car has 1,400 parts in the total power plant and emissions system, compared to an equivalent 200 parts in an electric car. Automation and electrics are why car companies want to assemble closest to the market of sale, so German automakers are simply offering what they are planning to do anyway. But no one is likely telling Trump that, and he wouldn't listen anyway.

Imagine if the US had decided to protect their manufacturing like this 20 years ago? How much better would things be now for the working class and the USA in general. Thank God someone is finally taking a stand and sticking up for America's interests.

These car manufacturers are undermining their own position by failing to create a united front at the European level and by groveling.

There is one USA auto builder that makes a world class car, Tesla. They are built in CA. Selling more Tesla's to help US workers in CA isn't even on Trump's radar. Instead he needs to convince German companies to build cars in the US in order to sell US manufactured vehicles overseas. What's the point of a zero car tariff in China for US produced cars if nobody wants them? The flip side of this if Trump threatens Foreign car tariffs on companies that are building cars in the US they can shut down our plants and furlough workers in retaliation.

Yes, The USA needs some way to eliminate its chronic imbalance or trade, but are tariff threats the answer? Might it not make more sense to solve the problem domestically without targeting or attacking any trading partner? That would be through rational, balanced, currency exchange control. Grant US exporters $ exchange credits that US importers must buy, on a regulated exchange, before releasing equivalent $ to pay for imports. No rancor, no trade wars, just common sense. Spend no more than you earn.