European automakers said that a private meeting with top White House officials Tuesday appears to have reduced the odds that the Trump administration would follow through on threats to add tariffs to auto imports.
“I would say this implicit potential threat was reduced,” Daimler Chief Executive Dieter Zetsche told the Wall Street Journal Wednesday. The automakers said that while they hadn’t recently added new plans to boost production in the U.S., they emphasized to administration officials that they were proceeding with already-existing plans to do so.
White House officials, including Commerce Secretary Wilbur Ross, economic adviser Larry Kudlow, and U.S. Trade Representative Robert Lighthizer, met Tuesday with representatives of European automakers Volkswagen, BMW, and Daimler in Washington, D.C. to discuss trade and tariffs. Ross told CNBC earlier that day that the release of a long-awaited Commerce Department report on whether the U.S. should institute tariffs was contingent on whether “negotiations with them are making good progress.”
Volkswagen Chief Executive Herbert Diess said he discussed his company’s plans to locate “an additional car plant for Volkswagen and Audi combined,” most likely in Tennessee, home to several foreign car manufacturing plants. He also highlighted plans to share auto parts supply chains with Ford Motor Co., a move that would give the latter a strong position in the EU market.
Mr. Zetsche cautioned that economic realities meant that production couldn’t be shifted that much. “[It’s] impossible to produce every single car that we sell here in this country because we would end up with very small volumes,” he said.
