Trump says open to China building cars in US as Xi visit looms

President Donald Trump discussed the possibility of allowing a Chinese car company to manufacture electric vehicles in the United States during a Fox News interview, emphasizing that the workforce involved must be American. Trump clarified his stance against Chinese cars being imported into the US, stating, "We don’t allow his cars into the United States, and we never did," referring to Chinese leader Xi Jinping.

Trump suggested that if China were to establish a plant in the US to produce its vehicles, he would be amenable to the arrangement, provided the company hired American workers. He noted that Japan already employs this practice. However, Trump expressed concerns about Chinese automakers building vehicles in Mexico and shipping them across the US border at a low cost, adding, "That’s un-happening."

The US currently restricts Chinese vehicles through steep tariffs and a national security ban on connected vehicle systems originating from US adversaries such as China. Trump's remarks come weeks before a planned summit with Xi, though similar comments have been made before. In a January speech at the Detroit Economic Club, Trump indicated openness to allowing Chinese automakers to build cars in the US, stating, "let China come in."

Earlier this year, Ford CEO Jim Farley and Trump cabinet members engaged in a preliminary informal discussion about the potential framework for Chinese automakers to build cars in America, while safeguarding domestic companies. No decisions were made at the time, according to sources familiar with the talks. Senator Elissa Slotkin, a Democrat from Michigan, warned against allowing Chinese cars into the US market, deeming it a "strategic mistake" that would negatively impact the US auto industry, manufacturing capacity, and jobs.

Trump dismissed claims that he would allow Chinese cars to be imported into the US as a "total phony rumor," asserting that he is the "only one stopping them." Senator Bernie Moreno, a Republican from Ohio, introduced legislation aimed at prohibiting connected vehicles, software, and hardware linked to adversarial countries, including China.

The measure, which garners support from Ford, General Motors, and the United Auto Workers, would prevent the sale of connected vehicles by automakers with more than 15% ownership by Chinese entities. However, there are concerns that the legislation, as originally drafted, may inadvertently disqualify other foreign automakers, such as Mercedes-Benz Group AG, which has nearly 20% Chinese ownership.