As the Trump administration sought trade concessions from Mexico in recent weeks, automakers and their suppliers feared that manufacturing costs could increase by billions of dollars. Now, they are breathing a sigh of relief.
The auto industry is still waiting to learn details of the preliminary agreement that President Trump and Mexican leaders announced this week and whether Canada will join the deal. Car companies are also watching to see if anything will come of a European Union proposal to eliminate tariffs on vehicles and other industrial goods if the United States agrees to do the same. Mr. Trump on Thursday told Bloomberg News that offer was ''not good enough.''
But analysts and consultants say most companies would be able to comply with the conditions in the agreement with Mexico that have been disclosed so far. Many of the changes that automakers would have to make -- like hiring more workers in the United States -- were in their plans anyway. But other changes, like requiring automakers to use more parts made in North America and an agreement to cap imports from Mexico, could raise costs and hurt some companies.
Companies ''are glad they now have some certainty on what the new requirements are,'' said Mark Wakefield, global co-head of the industry and automotive practice at AlixPartners, a consulting firm. ''Now they can plan around them and go forward.''
The preliminary deal would require that at least 75 percent of an automobile's value be produced in North America in order for a company to import it into the United States duty free. That is up from 62.5 percent under the North American Free Trade Agreement, the 1993 deal that Mr. Trump has called the ''worst trade deal ever made.''
Automakers would also have to use more local steel, aluminum, glass and other parts. In addition, 40 to 45 percent of vehicles would have to be made by workers earning at least $16 an hour -- a provision meant to preserve and create jobs in the United States and Canada, where wages are much higher than in Mexico.
These terms would force automakers to buy more parts made in the United States -- and possibly Canada. That should modestly increase employment at suppliers like Delphi Technologies and Johnson Controls, analysts said.
''The main takeaway so far is there is no giant influx of jobs coming into the U.S.,'' said Kristin Dziczek, vice president for industry, labor and economics at the Center for Automotive Research in Ann Arbor, Mich.
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