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Here's why Trump is so focused on auto jobs

If you're wondering why President Donald Trump has taken such a strong interest in auto industry jobs, you could start looking at the electoral map of the states that put him in office.

Of the 10 states that are the largest auto industry employers, eight of them went for Trump in the November election.


Trump met Tuesday with GM CEO Mary Barra, Ford CEO Mark Fields and Fiat Chrysler CEO Sergio Marchionne to help convince them to open new auto plants built in the United States.

"We have a very big push on to have auto plants and other plants — many other plants," he told reporters at the start of the meeting with auto executives. "It's happening."

Trump has vowed to cut regulations and taxes to make it more attractive for businesses to operate in the United States. But he also has criticized automakers for building cars in Mexico for shipment into the U.S. and has threatened to impose 35 percent tariffs on imported vehicles.

Trump got a polite reception from the auto executives Tuesday, though few details were provided on how he plans to follow through on his pledge. GM, Ford and Fiat Chrysler have all announced recent new jobs and investments in the United States, but are also continuing to build cars in Mexico.

Fields said automakers wanted to work with Trump to create a "renaissance in American manufacturing."

"We're very encouraged by the president and the economic policies that he's forwarding," Fields told reporters, praising Trump's decision to withdraw from the Trans-Pacific Partnership agreement, which Fields said did not address intervention in currency valuations by trading partners. "As an industry we're excited about working together with the president," he said.

For more than a century the U.S. auto industry has been concentrated in the American Midwest, in part for historical reasons. Long before sophisticated global supply chains provided overnight delivery of parts and raw materials, American carmakers set up shop where their most important raw materials, steel and rubber were manufactured.

Over the years, the assembly lines operated by major manufacturers spawned a network of smaller suppliers throughout the region, where many parts makers are still based.

That interdependence was brought in sharp focus when the Great Recession hit, sparking waves of layoffs that rippled through the region and the auto industry supply chain.

Since then, the job markets in most states have recovered many of those jobs. But auto industry employment levels has still not rebounded to pre-recession levels.

Trump has promised to restore those lost jobs, in part with his highly visible criticism of U.S. car companies expanding production in Mexico.

American car production also has recovered from the depths of the Great Recession, but since then a larger share of U.S. inventories is coming from factories in Canada and Mexico, according to data from the Bureau of Economic Analysis. About two-thirds of U.S. inventory this year was made within the nation's borders, with the remainder about evenly split between Candida and Mexico.

Trump also has gone after foreign carmakers who have set up shop in Mexico to service that local market and export their cars and light trucks to the U.S. Most of those Mexican factories are owned by foreign carmakers.

Expanding auto production the U.S. will ultimately depend on increasing demand for American-made cars. With flattening U.S. auto sales and some excess capacity, automakers have been reluctant to open new U.S. factories, though they have expanded output at some existing facilities.

GM and Ford last built new U.S. assembly plants in 2004, while Fiat Chrysler opened a new transmission plant in Indiana in 2014.

GM said in 2014 that it would invest $5 billion in Mexico through 2018, a move that would allow it to double its production capacity, and Barra has said the automaker is not reconsidering the plan, according to Reuters.

Earlier this month, Ford scrapped plans to build a $1.6 billion plant in Mexico and said it would instead invest $700 million in a factory in Michigan. Ford will still move production of Focus small cars to Mexico from Michigan, but will cut total production of the cars by consolidating their assembly at an existing Mexican plant.

— Reuters contributed to this story.