[SportySpice]

Originally Posted by JohnnyCanuck

Because they're not. They are building a new 3-series plant in Mexico to augment current facilities in Germany and China. Trump is now threatening to tax cars coming from Mexico because he believes that they should be building plants in the US.

What no one seems to understand in these threads is how the auto manufacturing sector in North America actually works. There is no such thing as a Mexican built, or Canadian made, or US manufactured car. The final assembly plant will, obviously, be in one of those three countries, but the supply chain is completely integrated across all three countries. Since 1965 there has been tariff free trade in the manufacturing of cars between Canada and the US. That was extended to Mexico with NAFTA, but there have long been Canadian made engines in US assembled cars and US made transmissions in cars "built" in Oshawa. What has changed is that the number of third party suppliers with equally integrated trilateral supply chains. A car allegedly built in Mexico could very well contain 35% American made components and 25% Canadian sourced assemblies. Those various components will themselves be multilateral in their manufacture and assembly. This whole notion of placing import taxes based on the final assembly location of a automobile within the NAFTA zone is somewhere between nonsensical and moronic. The net effect will actually be to cost all three countries auto manufacturing jobs and severely disrupt the industry. After bailing out the Big Three, Canadian and American governments are going to watch them lurch back into crisis because of stupid trade policy.

Hopefully the slim Senate majority and the presence of some Republicans who understand trade will serve to fetter the sheer stupidity of what Trump is proposing.

I know BMW is not moving any manufacturing from the US to Mexico but others seemed pretty adamant that this justified Trump's comments re: BMW. I've been on these boards only a short time, but I've been around long enough to know that threads can go from 0 to 100 faster than a modded M3. Hence, I thought it made sense to get some clarification on the point rather than call out a stranger for being un / misinformed. That's it.