CEO Column

Looking Ahead: Policy Solutions to Drive Auto Manufacturing Forward in 2025

Jennifer Safavian
January 31, 2025

Recently, I had the opportunity to participate in a panel discussion at the Washington, D.C. Auto Show’s Public Policy Day called From Parts to Purchase: The Impact of Tax and Trade Policy on the U.S. Auto Industry. The panel was moderated by Andrea Durkin, from the National Association of Manufacturers, and also featured Bill Long, President and CEO of MEMA, the Vehicle Suppliers Association, as well as Cody Lusk, President and CEO of the American International Automobile Dealers Association (AIADA). Together, we had an insightful discussion about the impact new tax and trade policies could have on the American automotive industry, especially on international automakers, suppliers, and dealers in the U.S.

The discussion comes at a critical juncture: Congress and the White House continue developing plans for tax cuts and possible changes to international trade policy. At the same time, the U.S. automotive industry is transforming and expanding, with more international automakers, suppliers, and dealers investing and planting roots in states across the U.S.

Direct investments from companies like Honda, Toyota, Volvo, Mazda, Subaru, and more have been increasing for more than 60 years, with investments from international auto manufacturers alone reaching $109 billion in 2023. Notably, this growth occurred despite supply chain disruptions from the pandemic, geopolitical forces, and tariffs over the last several years.

Our industry’s commitment to expanding our U.S. footprint, providing more consumer choice, making vehicles more affordable, and creating more American jobs has never been stronger. The right policies, including tax and trade, will truly unlock our potential and allow us to do our part to make the U.S. a manufacturing powerhouse.

One such policy has been the 2017 Tax Cuts and Jobs Act (TCJA). The engine of growth fueled by the TCJA allowed international automakers and suppliers to accelerate U.S. job creation, investments, and new technological advancements. According to the U.S. Department of Commerce Bureau of Economic Analysis, following passage of the TCJA from 2017-2022, investment in manufacturing increased from $1.6 trillion to $2.2 trillion.

Unfortunately, key provisions of the TCJA have expired and more are set to sunset at the end of 2025. We are encouraged by early conversations with lawmakers about extending the TCJA and hope Congress and the Administration will preserve a competitive tax system that allows for robust job creation, wage increases, innovation, and investment.

Beyond extending a pro-growth tax code, the success of the U.S. automotive industry depends on its performance on the global stage—where the free exchange of goods is not just beneficial, it is essential to economic growth and innovation. Building on President Trump’s actions to pass the United States-Mexico-Canada Agreement during his first term, more reciprocal trade policies support the U.S. economy, stabilize our supply chain, and grow our manufacturing industry.

International auto manufacturers, dealers, and suppliers in the U.S. support trade policies and partnerships that open markets and reduce barriers, enabling the industry to source high-quality materials and build resilient supply chains—thus lowering the cost of goods for consumers, including vehicles. This is particularly true with our key allies, including the United Kingdom, Japan, the European Union, and African nations.

Strong trade allies and partnerships also generate new and exciting careers in the U.S. and create American-made products to export to our trading partners overseas. In fact, just our members alone exported more than 762,000 U.S.-built vehicles to more than 130 countries around the world in 2023, supporting nearly 900,000 jobs in key manufacturing states across the U.S.

The next four years present an exciting opportunity for international automakers, dealers, and suppliers, as well as our workforce and the U.S. communities where we operate. We look forward to working alongside President Trump, Vice President J.D. Vance, and the 119th Congress to enact policies that will further grow our members’ U.S. manufacturing presence.

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