Trump invites Chinese to build US auto plants

Sign of possible thaw as GOP candidate offers China the same deal Reagan gave Japan in the 1980s

Republican presidential candidate Donald Trump on March 18 invited Chinese automakers to build plants in the United States, offering China the same deal that Ronald Reagan extended to Japan in the 1980s.

The former president vowed to impose a 100% tariff on Chinese car imports either directly from the mainland or from intermediaries like Mexico. But he added, “If they want to build a plant in Michigan, in Ohio, in South Carolina, they can, using American workers, they can. They can’t send Chinese workers over here, which they sometimes do. But if they want to do that, we’re welcome, right?”

Addressing Chinese leader Xi Jinping, Trump said, “You and I are friends.”

Trump’s offer to China went unreported in virtually all media. Mainstream US media attacked the former president for using the term “bloodbath” to describe the impact of prospective Chinese imports on the American auto industry, implying that he had threatened actual violence if he was not elected. But the transcript of his remarks at a Dayton, Ohio, rally makes clear that he was referring to industry conditions.

—

Industrial automation is accelerating in China and lagging in the United States. According to Zhang Weiwei, a professor at Fudan University, China already has 10,000 applications of 5G to the industrial Internet. Compare that with fewer than ten in the United States, by my informal count.

China now installs more industrial robots and graduates more engineers than the rest of the world combined. In 2023 it became the world’s largest auto exporter.

China meanwhile has extended its lead in 5G broadband. Zhang reported that China now has 3.37 million 5G base stations out of a global total of 4 million – 85% of installed capacity.

The United States may never be able to match China’s combination of skilled personnel, infrastructure and giant economies of scale. It’s easier to let Chinese companies bring industrial automation to the United States than to try to catch up after the fact. That’s the path of least resistance, and one that Trump has opened up.