Auto industry coalition urges Trump to block Chinese car makers from entering US

Source: Bloomberg

A broad coalition of automakers, suppliers, and dealers is calling on President Donald Trump to block Chinese cars from entering the United States, intensifying its request ahead of a summit between the two countries scheduled for next week that may involve Chinese electric vehicle giant BYD.

In a letter to Trump seen by Bloomberg, the coalition stated that existing effective barriers prohibiting China's entry into the US auto market are essential for maintaining fair competition. The group outlined the security risks and economic threats posed to the United States by subsidized Chinese vehicles and connected car technology.

"Allowing them to establish domestic plants would provide them with a foothold in the US market at the expense of manufacturers operating here," the letter said. "Chinese localization of production will not advance the government's manufacturing jobs and national security agenda."

Signatories and Escalation

The letter, dated September 17, was signed by multiple organizations, including:

• Alliance for Automotive Innovation, representing domestic automakers such as Ford Motor Company and General Motors, as well as overseas manufacturers like Toyota Motor Corporation and Volkswagen Group
• Autos Drive America
• American Automotive Policy Council
• National Automobile Dealers Association

While industry representatives have previously asked lawmakers to ensure the US maintains restrictions on Chinese cars, this new direct appeal to the White House represents an escalation just before Trump plans to meet with Chinese President Xi Jinping in Washington.

Trump's Mixed Signals

Recent remarks by Trump have raised alarms within the domestic auto industry, as he suggested he might be willing to allow Chinese car companies to produce electric vehicles in the US if they use American workers.

This is not the first time Trump has expressed openness to Chinese automakers entering the US. Earlier this year, while speaking in Detroit, he said he would "like it" if Chinese automakers wanted to build factories in the US, unsettling American carmakers.

BYD and the Summit

The issue became more urgent this week after Bloomberg reported on Wednesday that Chinese officials are considering including BYD in a potential business delegation accompanying Xi to the Washington summit. The list has not been finalized and could change at any time.

Global Expansion of Chinese Automakers

Chinese automakers are growing rapidly worldwide, gaining share in mature markets such as Europe while increasingly approaching the US doorstep. The Canadian government recently began allowing some Chinese electric vehicles into the country, while BYD vehicles have become common in Mexico.

Current Restrictions and Legislative Push

Currently, Chinese vehicles are largely excluded from the US market through:

• High tariffs
• A Commerce Department ban on so-called connected vehicle systems from foreign adversaries

However, automakers want Congress to go further by codifying a permanent US ban on Chinese cars and connected vehicle technology into law.

Several bills under consideration by lawmakers would advance these goals, including the Connected Vehicle Security Act, which passed a Senate subcommittee in July.

Earlier this month, the Alliance for Automotive Innovation wrote to Congress urging legislators to ban Chinese connected cars and related vehicle software and hardware before the January legislative session ends.

BYD's US Presence

BYD has been blacklisted by the Pentagon due to alleged ties to the People's Liberation Army—a claim the company denies. It also operates an electric bus manufacturing plant in California.

Original article: Bloomberg