The US auto industry is pushing back against President Donald Trump’s willingness to allow Chinese carmakers to build vehicles in America, warning that opening the market could put domestic manufacturers and jobs under pressure.

Six major automotive trade groups representing companies including General Motors, Ford, Toyota, Volkswagen, Hyundai, Stellantis and Tesla have urged Trump to maintain restrictions on Chinese automakers. 

The industry’s appeal comes ahead of Trump’s planned meeting with Chinese President Xi Jinping, adding another sensitive issue to already complex US-China trade discussions.

Trump recently said he would accept Chinese companies building cars in the United States if they employ American workers.

That position has raised concerns among US automakers, which argue that allowing Chinese manufacturers to establish local factories could give them a direct foothold in the American market.

The industry groups said Chinese automakers currently have no meaningful share of the US passenger-vehicle market.

They argue that allowing them to build locally could shift market share and jobs away from manufacturers that have already invested heavily in American factories and supply chains. 

The disagreement is also tied to national security concerns.

US restrictions introduced under the Biden administration effectively prevent Chinese automakers from selling or manufacturing connected passenger vehicles in the country because of concerns over technologies that can collect and transmit sensitive data.

Washington also maintains tariffs of about 100% on Chinese electric vehicles. 

The debate comes as Chinese automakers continue expanding internationally.

Companies such as BYD have gained ground in overseas markets, increasing pressure on traditional manufacturers in Europe and other regions.

Hyundai CEO José Muñoz recently warned that the US could experience a similar increase in Chinese vehicle competition if strong market safeguards are removed. He noted that Chinese vehicles can be significantly cheaper than competing models in some European markets. 

US lawmakers are also pressing Trump to maintain the restrictions.

On September 21, more than two dozen Democratic lawmakers urged the president to keep protections against Chinese automobiles and connected-vehicle technologies, arguing that China should not gain access to the American market through imports, local production or other routes. 

The timing has made the issue even more significant.

Chinese President Xi is expected to visit Washington this week, with executives from major Chinese companies potentially joining his delegation. BYD and battery maker CATL are among the companies whose executives may attend. 

For the US auto industry, the argument is no longer simply about where cars are manufactured.

It is about who controls future automotive technology, supply chains and market share.

Trump’s openness to Chinese investment has therefore created a new question for the American auto sector: Could allowing Chinese carmakers to build in the US create jobs and investment, or could it expose domestic manufacturers to a powerful new competitor?

The answer could shape the next phase of competition between the world’s two largest economies.