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US Trade Representative Jamieson Greer says this is not chaos in tariff policy because you don't change 70 years of policy overnight. He says China's is highest because it has the highest trade deficit, then EU, Japan, South Korea at 15% because of the smaller deficits with these nations, Vietnam because it is used  by China to send products to the US, India because of geopolitical reasons buying Russian oil. See Dasha Burns, Politico White House Bureau Chief's  interview with USTR Jamieson Greer.  He says about India- Jamieson USTR calls India "an outlier" and says "I'm confident we will get a deal with India in the near future." India he says has largely corrected its imports of Russian oil and negotiations are underway for a deal.  ON USMCA Greer says of the $31 trillion in trade with Canada and Mexico $29 trillion is us right. trade between Canda and Mexico is small. So he says it makes sense to negotiate separately with Canada and separately with Mexico. This suggests that there doesnt need to be a USMCA- separate deals are just fine says Greer. Mexico has gained much in automobiles under USMCA- US wants to make more in the US including auto parts which it can do by negotiating this with Mexico. It does not make a ton of economic sense to marry the three economies together, says Greer, as the import export profiles, lab,or situations are all different. Are Tariffs good for the economy and do they lead to higher prices? Greer says inflation was down in the first DJT term in trade with China and tariffs. Greer says there is never a 1 to 1 with tariffs. It tariffs become a kind of leveage in getting agreements. That is the style of these tariffs. You tell Ecuador or Brazil we don't make these here so there will be no tariffs on bananas and on coffee. Says Greer- we have seen inflation in check, imported goods relatively low priced. We have seen that we can have growth and higher wages with tariffs at the same time. The growth in 2025 third quarter at 3.8% annual growth, and Atlanta Fed predicting 4.2% growth in 2026. And tariff money can be used for paying down the debt and financing America's reindustrialization, Greer says members of Congress are asking about this.When a new administration comes tariffs will still be part of the playbook. ...

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Kessler in the WP corrects Obama's claim that he created 800,000 jobs. He says this is clever arithmetic as it takes a low point in Feb. 2010 following the financial crisis. Kessler points out that according to the Bureau of Labor Statistics, U.S. manufacturing jobs were 12.56 million in Jan. 2009 when Obama became president. In Nov. 2016, early estimates show there were 12.26 million manufacturing jobs, a loss of 300,000. This loss does not reflect the problems in the U.S. auto industry and older industries in the midwestern states as a result of trade and globalization that speeded up with the rapid industrialization of China. And led as Greg Ip pointed out in a recent WSJ report to a rapid acceleration of job losses in a decade that did not happen in the same scale during Japan's industrialization and urbanization in the sixties. This aggravated the situation in Michigan, Ohio, Wisconsin, Indiana, and Pennsylvania, and was met with a feeble response from Democrats. Even a economist like Krugman favoring the Obama administration's efforts came to the conclusion that TPP did not add much to gains from trade as most of the gains had already been realized. More of the gains went to tech and IT in California, at the expense of the auto industry based in the midwest. A report in WP show a president too close to IT in California and failing to grasp the situation in the midwest. Voters punish whoever is in power, regardless of being Conservative or Liberal, in Canada the hollowing out of manufacturing under Harper in Ontario and Quebec led to the win by Trudeau's Liberals.  ...

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Ford is offering packages with additional incentives, college tution for entire family, packages of upto $140,000 to sign up workers to take buyouts. Its goal is to get 8000 more workers to take buyouts. This is in addition to the 32,000 workers already given buyouts or early retirement.It is putting up job fairs in its plants and mailing each of its 54,000 hourly workers full length DVD " Connecting With Your Future" that shows the advantages of looking beyond the assembly line jobs in auto plants. This suggests that Ford has done its anlaysis and sees things getting tougher in the US auto market over the next few years. The US auto industry will definitely see a smaller market and shrinking sales from now on. Just look at the shrinking sales in the Japanese and German auto industry. Something like this is likely to happen in the US and the attention to sales is going to shift overseas where most of the new sales are going to occur. Companies like GM and Ford will do what IBM and GE are doing shifting their focus to overseas sales in an expanding global economy with more than 50% of their sales from overseas and the US markets playing a smaller role. All this means fewer workers needed in the USA and new workers and plants to be put up overseas in new international locations over the next 10-15 years. Its not just a down cycle for the auto industry, its a big shift and the kind of change that happens every 50 or 100 years as huge macro changes are underway in the world....

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The educated reader does touch on something the automakers should hear- its not just the carmaking skills that count its making something thats cool, that younger people want.

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Ford says its new car sales in Europe declined by 16% in June even though auto sales in Europe declined by 1.3%. For the first half of 2012 Ford sales declined by 9.6%, and industry sales fell by 4.8%. The markets in Russia, Turkey and Romania are offsetting declines in other countries.

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Ford Motor Company makes a huge decision to exit the sedan business by discontinuing the Ford Focus and Fusion sedan car lines. The decision was made under CEO Hackett, and CFO Shanks, and means that Ford will have no fuel efficient car lines to offer to customers. During the recovery after 2008 and the bankruptcy of Chrysler and GM fuel efficient cars were one way the auto industry in Detroit was able to come back. Ford still depended heavily on the F series truck for profits as the market improved. With the current  popularity of SUV's the U.S. automakers are once again shifting to SUV's which does not protect the American automakers in competition with Japanese automakers if the demand partly shifts back again to sedans. Toyota has retained the Corolla and Camry and continues to upgrade its sedan models offering a broader product line better able to handle shifts in consumer demand that have in the past created problems for Ford and Chrysler. Chrysler has shifted away from sedans since 2016. Mr. Hackett is a former CEO of Michigan based office furniture maker Steelcase, and it is not clear if the lessons learned over the last decade at Ford Motor in competition with the Japanese resonate under a CEO with a different background such as that of its current CEO. ...

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Volkswagen restructuring in Western Europe. Note the price pressures in global markets and high import taxes in growth markets like Russia, China and India. This puts more pressure for restructuring Western European auto manufacturing.

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Next five year plan for China calls for more concentration on industry, dominance in key sectors identified by China such as rare earths, and more exports- not less in each of these areas. Chinese Communist Party is very conservative and once this has worked for China it is not going to change its reliance on exports even at the risk of leaving goods unsold in China or oversupply. The result is that the US effort to reduce the trade deficit, trying every tool in the book does not work, leading to an effort to resort to tariffs as a last resort to cut the unhealthy and risky $1 trillion trade deficit China has with the world. Has it worked? WSJ and other reports show that large companies are diversifying their supply channels, only smaller companies without the resources are sticking with China dependence for supplies. The tariffs themselves make headlines yet the US has made careful calculations not to upset relationships with key partners Britain, European Union, and Japan, keeping tariffs low at 10% with EU, and 15% with Japan which exports automobiles to the US to recover some of the years US made concessions to Japan. There are also loopholes on certain products where it is in the US interest to do so. As a result the effective tariff is 10-12.5% not 17-20% shown in reports. Of this 10% what is passed on to consumers is small- as in autos 80% of tariffs are not passed on by auto importers such as Toyota and Subaru because of the higher margins postpandemic. In retail only 30% is passed on again because of the post pandemic higher margins. The administration of DJT has also carefully worked with world oil suppliers to keep oil prices low, lower than in 2023-2024. The result is that inflation is at about 3% in September 2025. The idea that a capricious DJT is doing the tariffs is a myth as careful economic planners including Bessent, Jamieson, Lighthizer, and Luttnick, economic advisors in the Republican party, are carefully articulating the policy with room for DJT's political talk and appeal to public sentiment. ...

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Sergio Marchionne, CEO of Fiat-Chrysler told a conference in Michigan -"these are people who did not grow up and become conditioned to doing business in Detroit. " He cited this as one reason the new generation of leaders at the U.S. auto companies had embraced the new fuel efficiency standards. Another point he made that was well received was that "anybody who surrenders 14 years before the date ought not to be in business." He was referring to the 2025 deadline for the new standards. This view was well accepted by the other auto companies and by the UAW workers union, showing the big change that has come about in the U.S. auto industry.

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Financial squeeze on automobile dealers as GMAC and Ford Credit and Chrysler's financial arm see a deterioration in their condition and can no longer provide the favorable financing and loans to dealers. Bill Heard Enterprisesone of the largest Chevrolet dealers in the USA with 2007 sales of $2.1 billion faces financial losses and GMAC has stopped doing business with the company which has a chain of 14 stores.

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11 Pacific Rim nations form the Trans-Pacific Partnership in 2018. The Obama administration supported the trade pact alienating supporters in its union base particularly in the midwestern states. Mr. Trump opposed the TPP in his election campaign and made it a significant issue for swing voters in midwestern states after job losses in the auto industry. With the opposition of president Trump the U.S. decided to withdraw from TPP.  The 11 nations agreeing to join a revised agreement are Japan, Canada, Mexico, Australia, Brunei, Chile, Malaysia, New Zealand, Peru, Singapore and Vietnam. So far six countries have formally approved the deal, Australia, Canada, Mexico, Singapore, New Zealand and Japan, setting the stage for two rounds of tariff reductions starting December 30, 2018. Agricultural products duties will be duty free within 3 to 7 years including for Japan and Mexico. Australia, New Zealand, Canada are major agricultural exporters. Japan supported the deal as a way to counter China's influence in the region. In the U.S. the gains would be in intellectual property rights but losses for workers in the auto and manufacturing industries, a point Mr. Trump recognized in his election campaign as he campaigned in the midwestern states. Mr. Obama pursued TPP over objections of workers organizations and unions including auto workers union, with his advisors suggesting this as a way to counter China's influence in the region. By 2018 the Democratic party support base fractured on this as one of the major issues.   ...

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The Supreme Court of the US lets stand the ruling of lower courts and the National Labor Relations Board that says unions can organize and represent workers on the docks in container terminal at South Charleston. The Charleston terminal is in right-to-work state South Carolina. It is the fourth largest container terminal on the East Coast after NY NJ Terminal, Port of Savannah Terminal, and Port of Virginia. A new terminal is being built at Savannah on 395 acres to handle addition 2 million containers per year. Savannah, Georgia is another right-to-work state. Georgia Ports Authority now says it is talking to the ILA and the decision for union labor will not affect its plans for expansion. The Biden administration has supported cost of living action through increase in workers wages and helping workers organize through unions after a long period when labor was not able to push for a fair wage and the relationships between labor and employers were excessively drifting against workers. Rail strikes were settled with an agreement, auto strikes were settled with Biden on the picket lines in Detroit for the United Auto workers. International Longshoremans Association labor efforts at NLRB are part of this story of Biden and the changing face of labor in the US.   ...

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Poorly capitalized Indian banks and financial institutions with large percentage of bad loans contiues to hurt the Indian economy. Shortage of credit is leading to problems in retail and auto sectors. The government is using $21 billon from the central bank, the RBI, for stimulus and to recapitalize banks. Higher infrastructure spending is needed to make up for a drop in consumer demand.

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News on several fronts in June 2009. On housing, a month to month improvement but still stuggling compared to a year ago levels. The Commerce Department said that an increase in multifamily units led to housing starts jumping 17% in May from April to a 532,000 annual rate. Compared to ayear ago level housing starts was down 45% from May 2008. There were 10 times more homes for sale in April as sold that month, with the typical ratio at 6. With layoff, tight credit and rising mortgage rates laying aheavy hand on these markets, even as developers cut prices deeply to clear unsold homes. On Manufacturing. Industrial production fell 1.1% in May from April, according to the Federal Reserve. Capacity utilization fell to 68.3%. See the graph for the steep drop for auto and auto parts manufacturing. On inflation. The producer price index showed its largest decline in 60 years, according to a Labor Department report. The PPI was down 5% from one year ago, the biggest decline since 1949. It went up from April to May by 0.2%. Part of this was rising oil prices. The core PPI which excludes food and energy dropped 0.1% in May from April. Rising oil prices, a falling US dollar and stabilization in the economy are reducing defaltion risk. At the same time the sign that inflation is not taking root are clearly evident in the slack that is building up with the drop in the capacity utilization rate to 68%, and further declines expected as the auto industry shrinks in 2009, with the huge overcapacity worldwide in that industry. ...

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Vauban is a "car- free" upscale communitynear Freiburg, Germany, close to the German-Swiss border. Except for the main street where atram to Freiburg runs, and two parking lots outside the community, there is no place to park cars. About 70% of the people there do not have cars and 57% sold their cars to come here. There are no car garages or parking places with each home. Bicycles are hte main means of transport. Vauban hasd 5500 residents in one square mile. The basic concept of having stores placed only awalk away is being followed more and more as America and Europe shifts away from intensive auto based use of space for living. The whole post war location of housing and stores and community activities was based on large use of the automobile. This is now going through big changes. David Goldberg, of Transportation of America says " how much you drive is as important as whether you have ahybrid." A fast growing coalition of hundreds of groups is advancing the cause of building communities with stores only a walk away and less need for the automobile to get around. Outside Hayward, California, Quarry Village is anew development that is trying to reduce autos to one per home. So car based is American culture that most zoning laws require 2 parking spaces per residential unit, and in the federal transportation bill 80% of appropriations in prior years used to go by law to highways and only 20% to other transport. This even though passenger cars are responsible for 12 percent of greenhouse emissions in Europe , and upto 50% in some car-intensive areas of the USA. One solution to the problem is to use smart planning to avoid the suburban sprawl, and shift to smaller more fuel efficient automobiles, and build better mass transit and rapid transit and fast rail linking most towns and cities, that will moderate all the excess that took place after the war. This may be the direction smart planning is taking us, and places like Vauban remaining niche communities for green advocates and a sort of reminder that its possible to go in this direction....