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Ready or not, Detroit automakers, here's President Trump

Jan 20, 2017

The president rightly credited with saving Detroit’s auto industry from itself is gone. Barack Obama’s $80 billion-dollar decision remains controversial but the outcome is much less so.

In the space of eight years, the automakers once teetering on the edge of collapse look nothing like the two creaking hulks that endured bankruptcy. The third, Ford Motor, barely avoided a similar fate.

Whatever you think of Obama, the industry would not be where it is today, would not be posting record North American profits, would not be playing leading roles in the mobility game without his dicey call.

That decision extended the financial lifeline first thrown by President George W. Bush, and it has made all the difference. For the automakers, whose leaders learned what Chapter 11 could accomplish. And for their hometown, which later used bankruptcy to retire debt, to restructure and to accelerate an economic revival that’s still gaining steam.

Blame pesky consumers who aren't buying the vehicles bureaucrats think they should.

Yet Obama’s automotive legacy - so critical to a region still synonymous with American industrial power - is mixed. For all the good his bailouts did, his administration’s regulatory biases and product preferences skewed absurdly academic and often turned out to be flat wrong.

The U.S. market didn’t embrace small hybrid cars; it demanded more trucks and SUVs. Oil prices didn’t stay high; gas, now, is closer to $2 bucks a gallon. The toughened fuel economy rules that Team Obama foisted on the industry at its weakest point are proving expensive and harder to achieve. Blame pesky consumers who aren’t buying the vehicles bureaucrats think they should.

What a surprise. But Obama is gone now, even as his automotive legacy endures. And, in his place: Donald Trump.

The Tweeter in Chief already has used his electronic bully pulpit to embarrass the industry and allegedly bend its biggest players to his will. The new POTUS says too many companies build cars in Mexico and ship them to U.S. showrooms. To make the point, he repeatedly threatens a 35% tariff or something like it.

The industry’s response: privately complain but publicly placate.

Ford is canceling construction of a new plant in Mexico. General Motors will bring axle production back to the States. Fiat Chrysler is readying plants in Michigan and Ohio to build next-generation Jeeps. Even foreign automakers are getting into the act, chiefly because equal-opportunity tweeting is targeting the likes of Toyota and BMW, too.

Trump naturally claims credit for the auto announcements, which conveniently ignores the simple fact that decisions like these are years in the making.

Calm down, folks.

Trump naturally claims credit for the auto announcements, which conveniently ignores the simple fact that decisions like these are years in the making. The only question is timing - when to make them public, in what context and to whose benefit.

In that, it’s safe to say Trump’s badgering helped and so did the promise of tax reform and regulatory changes under a new, business-friendly administration.

Eight years ago, Detroit’s automakers needed a president willing to make hard decisions to avert total collapse. Now they’re hoping his successor can be a real advocate for American manufacturing and trade.

It’s up to Trump to prove whether he will be.

Daniel Howes is a columnist at The Detroit News. Views expressed in his essays are his own and do not necessarily reflect those of Michigan Radio, its management or the station licensee, The University of Michigan.