Chinese automakers build factories in Mexico, claims Trump

Former US President Donald Trump made several controversial statements about the automotive industry during a stop in Flint, Michigan, a state known for its significant role in American car manufacturing. Trump reiterated his unsubstantiated claims that Chinese automakers are constructing large factories in Mexico, threatening to impose a 200 per cent tariff on any vehicles produced in these purported facilities and exported to the United States.

Trump's rhetoric extended to predictions about the future of the US auto industry under potential Democratic leadership. He claimed that if Vice President Kamala Harris were to be elected in November, the American auto industry would cease to exist, with electric vehicle production shifting to China. This assertion contradicts current employment data in the automotive sector, which has shown growth since President Joe Biden took office in January 2021, following a decline during Trump's tenure.

The former president went on to declare that without his re-election, the US would lose its entire auto industry within two to three years, dismissing any increases under the Biden-Harris administration as temporary. He asserted that China would take over all manufacturing plants due to the transition to electric vehicles.

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Trump proposed a strategy of imposing tariffs on imported automobiles to compel foreign automakers to establish factories in the US, describing it as "taking candy from a baby." However, this statement overlooks the fact that many foreign automakers already operate multiple manufacturing facilities within the United States, particularly in southern states.

Contrary to Trump's claims, Bureau of Labor Statistics data shows that auto and parts jobs have increased by 13.6 per cent since Biden took office, rising from just over 949,000 in January 2021 to 1.07 million in August. This growth contradicts the notion of a disappearing industry.

Trump's assertions about Chinese-owned auto factories in Mexico also appear to be unfounded. Industry analysts report no large Chinese-owned auto factories currently under construction in Mexico. The only Chinese presence in Mexico's auto manufacturing sector is a small assembly plant operated by JAC, which produces inexpensive vehicles from kits for the Mexican market.

The former president also promised to impose tariffs on vehicles made in countries that tax US-made vehicles. However, economists often point out that such tariffs are frequently passed on to consumers in the country imposing them, rather than achieving their intended effect on foreign manufacturers.

In response to Trump's claims, the Harris campaign issued a statement through Michigan Senator Gary Peters. The statement contended that a second Trump term would be detrimental to auto jobs and surrender Michigan's global leadership in auto manufacturing to China. Peters emphasised that Harris has a plan to bring back well-paying manufacturing jobs and ensure Michigan workers continue to lead in global auto manufacturing.