There’s a big difference between tariffs on cars from China, and tariffs on all goods from Canada and Mexico. US car manufacturers produce and import lots and lots of intermediate goods from those two countries. Setting up tariffs on those two with the hope of reshoring the manufacturing is problematic because it takes time and capital to build those types of supply chains and also develop the expertise among workers to operate those factories efficiently. Those workers and that capital will need to be devoted to building yesterday’s car parts instead of tomorrow’s.

Preventing cars from being imported from China is still a problem too. American companies are going to innovate slower without the competition. We may see a day when Chinese cars are just miles ahead of American cars in terms of technology, efficiency, comfort, and price. At that point, people are going to be asking “why am I paying so much for this shitty car when much better alternatives are available? Whatever happened to capitalism in this country?” And once those protections are lifted, the car industry would face rapid, destabilizing collapse.

A slower, controlled collapse (not saying that would definitely happen) of the US car industry would mean those resources (the capital and labor) would be able to be put to more productive uses in this country. There’s a lot of stuff we want to build, like modular nuclear power plants, wind turbines, geothermal plants, AI data centers, prefab new housing, humanoid robots, or some other stuff I can’t even imagine. I personally think robotaxis/AV are going to put the entire worldwide car industry into near terminal decline anyway. We should try to pivot away from that industry as gracefully as we can.