Donald Trump tells car makers he'll cut environmental regulations

Donald Trump's meeting on Monday with prominent American manufacturers included Elon Musk, the head of Tesla Motors, ...
Donald Trump's meeting on Monday with prominent American manufacturers included Elon Musk, the head of Tesla Motors, pictured. AP
by Jennifer Jacobs and Jamie Butters

US President Donald Trump has told chief executives of the three biggest US car makers that environmental regulations are "out of control" and promised he would remove obstacles for manufacturers and oil companies.

Leaders of Ford, Fiat Chrysler and General Motors met Trump at the White House, the most recent in a series of meetings this week aimed at bolstering the US manufacturing sector. The president reiterated his desire to reduce regulations, which may indicate a willingness to scale back federal fuel-economy demands.

"I am, to a large extent, an environmentalist," Trump told the auto executives. "I believe in it. But, it's out of control."

Trump's meeting with Ford CEO Mark Fields, GM CEO Mary Barra and Fiat Chrysler CEO Sergio Marchionne occurred a day after he signed a memorandum withdrawing the US from the Trans-Pacific Partnership trade agreement, claiming the pact would hurt workers.

He has pledged to renegotiate the North American Free Trade Agreement with Mexico and Canada.

Fields, who also met with Trump on Monday as part of a group of manufacturing executives, returned to the White House on Tuesday for the meeting with car makers.

"We have a very big push on to have auto plants, and other plants," Trump told the auto executives. "We're going to make the process much more simple for the oil companies and everybody else that wants to do business in the United States."

The meeting presents Detroit's car makers with a key opportunity to weigh in on big issues the administration plans to tackle in its earliest days, including trade, regulatory and tax reforms.

Fields planned to discuss corporate tax reform, the need for "data-driven regulations" and trade policy initiatives that address foreign currency manipulation, Ford spokeswoman Christin Baker said.

Before the meeting with car makers, Trump tweeted on Tuesday: "I want new plants to be built here for cars sold here!"

The last new vehicle assembly plant GM, Ford or Fiat Chrysler built in the US was GM's Lansing Delta Township, opened in 2006. It builds Chevrolet Traverse, GMC Acadia and Buick Enclave SUVs.

Trump's meeting on Monday with prominent American manufacturers included Elon Musk, the head of Tesla Motors. Trump said then he'd dramatically cut regulations and corporate taxes. But the president warned that manufacturers would face tough penalties if they move production outside the country.

Cutting regulations

"We think we can cut regulations by 75 per cent. Maybe more," Trump said on Monday. "When you want to expand your plant, or when Mark wants to come in and build a big massive plant, or when Dell wants to come in and do something monstrous and special - you're going to have your approvals really fast."

After the meeting, Fields said he was confident Trump was "very serious on making sure the United States economy is going to be strong and have policies - on tax, regulatory or trade - to drive that."

Trump has openly agitated for US car makers to keep jobs in the US and cancel plans to build plants abroad.

"Car companies and others, if they want to do business in our country, have to start making things here again. WIN!" Trump tweeted on Sunday.

Domestic investments

All three car makers have given Trump fodder for promoting his efforts to boost US hiring. Ford cancelled a $US1.6 billion ($2.11 billion) car assembly plant in Mexico and has said it will spend $US700 million to expand a Michigan factory instead.

GM and Fiat Chrysler have each pledged $US1 billion in investment toward domestic assembly, though both companies have said their plans were made before Trump winning the election.

All three also continue to produce vehicles in Mexico. Ford will assemble Focus compacts at an existing factory in Hermosillo already building Fusion and Lincoln MKZ sedans.

GM hasn't announced any step back from plans announced in late 2014 that it would spend $US5 billion on new plants in the country by 2018, creating 5600 jobs. Fiat Chrysler has seven facilities south of the border building parts as well as Ram trucks and vans, Fiat 500 small cars and Dodge Journey sport utility vehicles.

In November, the Alliance of Automobile Manufacturers sent an eight-page letter to the Trump transition team with a series of recommendations, including aligning programs run by the EPA and the National Highway Traffic Safety Administration.

Inconsistent rules threaten to saddle the industry with "potentially billions of dollars in fines", said the trade group, which represents most of the world's biggest car makers including GM, Ford, Toyota and Volkswagen AG.

The alliance asked for a presidential panel to review all car regulations, including fuel-economy rules, as consumers continue to reject efficient cars and electrified vehicles in favour of pickups and SUVs.

"The combination of low gas prices and the existing fuel efficiency gains from the early years of the program is undercutting consumer willingness to buy the vehicles with more expensive alternative powertrains," the group said.

Bloomberg