United States President Donald Trump. Let that sink and settle in your gut if it hasn’t already. Because it’s real, and we’re not waking up from it. And whoever you are and whatever you do in this world, this has got to sting big time, because the most unfit human being now holds the reins to the most powerful post on the planet. Which could result in an impeachment case at best, or the end of mankind at worst.
This sentiment—this paralyzing fear—is palpable even—especially—in the car industry. If you think the world of automobiles is pretty insulated from politics, you haven’t been tuning in to CNN lately. In case you missed it, Trump used Ford as a punching bag to make himself look dauntless in the eyes of his impressionable followers. In a nutshell, he accused the American carmaker of taking jobs away from the US and moving these to Mexico just because it is soon building its small cars in a neighboring country. That can’t be farther from the truth, of course, as Ford explains that the number of its employed American workers will be unaffected by the development—that its US-based manufacturing facilities will continue building vehicle models. Business as usual, in other words.
He then threatened to levy punitive taxes on Mexico-made Ford vehicles to supposedly strong-arm the company into producing its cars back in America.
Either Trump was misinformed or he’s simply this stupid. Either way, that can’t possibly be good for the auto industry—even for non-American car companies. Because if the leader of the free world is this clueless and this far removed from facts, global business is in deep shit.
Indeed, as soon as Trump’s victory was ascertained, the top management of one American automaker immediately sent out a memo to all its employees around the world, warning them against making a comment about Trump. You just don’t antagonize a surly POTUS who berates detractors on Twitter at three in the morning. Because it could have serious consequences for your business interests.
So yes, when we asked high-ranking executives in the Philippine car industry, at least two company presidents declined to comment, while two US-based bosses asked not to be identified. Gotta fear The Donald, we suppose.
Anyway, the question: What does a Trump presidency now mean for the entire car industry?
There are safe, wait-and-see replies.
“It’s too early to say,” answered Lexus Manila president Danny Isla. “It’s better to wait for his policies and strategic directions. Trump has no political experience. He is a business person—always has been.”
“As with any election—and even more so with this one—there’s a lot of emotions running now,” observed BMW Philippines president Maricar Parco. “But we expect that all these will settle down. Hence, I see no drastic effect on our local car industry.”
There are guesses and wagers.
“In the short term, there might be some swings in the foreign exchange and in the interest rates that may lead to a cautious attitude on the part of the consumer in purchasing big-ticket items like cars, and may result in a slowdown in sales,” offered Chevrolet Philippines president Albert Arcilla. “But I expect it to rebound in a quarter or sooner, when the initial reaction to a new administration simmers. The need for access to mobility will remain, so people will still have to buy new cars. We will have to look into the policy directions with regard to manufacturing as this will change the business model that affects sourcing and tariff, which is now based on the current free trade agreements.”
“I am betting that President-elect Trump will support the domestic automotive industry in the US,” expressed Peugeot Philippines president Glen Dasig. “America has always been known to be the automotive capital of the world, and if he plans to make America great again, this may be one of the industries he will prioritize. A competitive American car industry should spur more innovation. In the end, the consumer wins.”
There’s apprehension and uncertainty.
“For the auto industry and other businesses in the US, it will be difficult to speculate considering what’s currently happening—protests and all,” veteran motoring journalist Butch Gamboa said. “But Trump’s upset win, which is not by popular vote, is indeed worrisome.”
“Personally, we have to rely on the checks and balances of the federal system to guide and constrain any changes,” shared a US-based executive who asked to remain unnamed. “There is a narrow range of economic variables that could help to incentivize local production, but it does not sound like the president-elect understands how to use such forces.”
My favorite insight, however, is this one from another US-based industry boss who likewise requested anonymity. We’re printing his comments in italics:
I think the majority of educated Americans know that Trump was playing the deplorables like a violin. Wherever he went, he fed them a bullshit sandwich, and they ate it up and asked for seconds. Anyone that thinks Trump will build a 2,000-mile wall between Mexico and the US should be institutionalized, along with Trump—he just fed into the southern states’ fear of Mexicans, and they ate it up.
Then he took advantage of the wacko Islamic extremists and the horrific crimes they committed, and he fed into their fears. And those uneducated idiots ate it up. Then he went to the rust belt and took it up a notch, telling them that the democrats were responsible for free trade agreements that sent their jobs to Mexico, and that only he could bring those jobs back, which is another bullshit sandwich served with fries. Which these idiots, mostly unionized democrats, swallowed whole, thinking that Trump would actually force companies like Ford, GM and FCA to shut down Mexican factories at $5 an hour and move work to the US at $55 an hour. He knows he can’t do it, but he told them he could. And they ate it up.
This is nothing more than a reality show for this guy, and he’s screwing with the minds of all Americans. Everyone will suffer through four years of mental anguish—assuming he makes it to his inauguration.
So what would Donald Trump mean to the auto industry? By all indications, a lot of guessing, a lot of worrying, a lot of cussing. Good luck to all of us.