Auto groups urge Trump to keep Chinese carmakers out of US

By David Shepardson

WASHINGTON, March 13 (Reuters) - Major auto trade groups urged the U.S. government to keep Chinese carmakers out of the country, according to a letter seen by Reuters, potentially complicating President Donald Trump's planned summit with Chinese President Xi Jinping.

The groups raised "serious concerns about China’s ongoing efforts to dominate global automotive manufacturing and to gain access to the U.S. market. These actions pose a direct threat to America’s global competitiveness, national security, and automotive industrial base."

The five groups representing automakers, car dealers and parts manufacturers called for maintaining a 2025 Commerce Department cybersecurity regulation that effectively keeps nearly all Chinese vehicles out of the U.S. market.

The Chinese embassy in Washington rejected the criticism, saying Chinese-made cars are popular globally "not by using so-called 'unfair practices' but by emerging from the fierce market competition with technological innovation and superb quality. China’s door has been open to global auto companies, including US auto companies who have fully shared in the dividends of China’s big market."

The auto industry letter also criticized Canada's announcement it would allow some Chinese vehicles into its market.

Trump is expected to visit China from March 31, as the world's two biggest economies seek to maintain the stability that has characterized their relations since late last year, after a bruising period marked by Trump’s tariffs and China’s chokehold on rare earths exports.

"We also strongly urge the Administration to reject any attempt by Chinese manufacturers to circumvent these existing restrictions by establishing production facilities in the U.S.," said the letter, dated Thursday, from the Alliance for Automotive Innovation, the National Automobile Dealers Association, Autos Drive America, the American Automotive Policy Council and MEMA, the Vehicle Suppliers Association.

"The market distortions and risks to the auto industry in the U.S. are fundamentally the same whether these vehicles are imported or produced domestically," it said.

In January, Trump said he was open to Chinese automakers building vehicles in the United States. "If they want to come in and build a plant and hire you and hire your friends and your neighbors, that’s great, I love that,” he told the Detroit Economic Club.

In December, the Alliance for Automotive Innovation, which represents General Motors, Ford, Toyota Motor, Volkswagen, Hyundai, Stellantis and other major automakers, said "China poses a clear and present threat to the auto industry in the U.S." and urged Washington to prevent Chinese government-backed automakers and battery manufacturers from opening U.S. manufacturing plants.