Al Root
President Trump visited Detroit, Michigan, on Tuesday, in the heart of the American auto industry.
His talks were far-ranging, and his message to executives and investors was similar to past statements: He wants car companies to build in America, even if they are Chinese.
"Let China come in," said Trump at one point, a statement that might raise eyebrows for American auto executives. China has low-cost sources of parts and labor, and its BYD is now the largest seller of all-electric cars globally, topping Tesla for the first time in 2025.
But the president isn't considering reducing tariffs on Chinese-imported cars, which are currently 100%. So Chinese car companies would need to build plants, develop dealer networks, and create supply chains. It would take years. Still, the threat of new competition could give investors in current U.S. car producers an uneasy feeling in their stomachs.
The stocks didn't react much to Tuesday's talks. Ford Motor stock closed down 0.3%, while the S&P 500 and Dow Jones Industrial Average fell 0.2% and 0.8%, respectively. GM shares gained 0.4%, while Stellantis shares fell 3.4%.
Coming into Tuesday trading, that group was up an average of 32% over the past 12 months. Early 2025 fears that tariffs would wipe out industry profits proved overdone. Profitability declined in 2025 relative to 2024, but results were better than feared. GM, for instance, is expected to generate $12.7 billion in 2025 operating profit, down from almost $15 billion earned in 2024.
Shares of suppliers Lear, Aptiv, and Magna International were up 0.3%, 1.7%, and 1%, respectively. Coming into Tuesday trading, that group was up an average of 42% over the past 12 months.
Building in America will remain a central tenet of the president's policy. Understanding which car is American-made can be hard. In recent years, only half of all new cars sold in the U.S. were assembled here. Imports from mainly Japan, Korea, Mexico, Europe, and Canada made up the rest. Even the cars assembled here often have some foreign parts.
Cars.com produces an annual American-Made Index. Tesla took the top four spots in 2025 with its Models S, 3, X, and Y. Many cars from domestic producers such as Ford Motor and General Motors made the list, and so did cars from foreign auto makers assembling cars in the U.S., such as Kia, Hyundai, Honda, and Toyota.
Auto makers tend to build cheaper models in places such as Mexico, but assembling cars in the U.S. makes sense as long as there are low-cost parts, says BofA Securities analyst John Murphy.
Car affordability remains a problem, though. The average new car price increased from $37,824 in 2019 to $49,368 in 2025, according to Cars.com data.
There are, of course, many reasons for the rise, including higher wages earned by workers. Whatever their ideas to correct affordability, however, won't likely include importing low-cost parts and cars from overseas.
For President Trump, that era is over.
Write to Al Root at allen.root@dowjones.com
This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
January 13, 2026 16:17 ET (21:17 GMT)
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