Auto Industry Wary of Trump Presidency Impact

Carmakers are nervous that the global auto industry could be seriously disrupted by the evolving trade policies of U.S. president-elect Donald Trump.

On the campaign trail Trump has said he wants to renegotiate or scrap the North American Free Trade Agreement in a bid to gain more jobs in the U.S. He also has separately threatened hefty tariffs on vehicles shipped from Mexico to the U.S.

Either move would jeopardize the current or future operations there of nine U.S., European and Asian carmakers. Annual vehicle production in Mexico has surged 50% to about 3.5 million units over the past 10 years and has been projected to reach 4.2 million in 2017, according to the Center for Automotive Research in Ann Arbor, Mich.

Trump also has floated the idea of slapping 45% duties on products imported from China. Such a move would block fledging moves by carmakers such as General Motors and Volvo to import cars built there.

Economists say any similar effort to raise tariffs on vehicles imported from Europe or Asia would prompt other countries to retaliate with their own fees on American-made exported automotive and non-automotive products.