Auto Workers Welcome Trump’s Tariffs – No Matter What’s Happening on Wall Street

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The county’s unemployment rate hit 5.1% in March, according to Federal Reserve data, higher than the 4.2% jobless rate in the US overall.

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Benson blames the political class for the decline of US manufacturing. Trade deals like the North American Free Trade Agreement gave companies the freedom and the incentive to find cheaper factory labor elsewhere, and presidents from both parties watched it happen, he said.

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Unions and manufacturing workers have long pushed for tariffs, but Trump’s trade policy has been especially aggressive, raising the prospect of a recession that could throw people — including auto workers — out of work and decimate small businesses while sparking inflation. 

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Employment in auto and auto-parts manufacturing has risen steadily since Obama took office in 2009, except for when Covid-19 led to mass layoffs during the pandemic, according to the US Bureau of Labor Statistics. The industry now employs about 1 million workers, the most since 2007. 

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Those recent highs pale in comparison to Detroit’s heyday, however. The UAW had 1.5 million members in 1979 — now it’s about 370,000. Mexico has more than a million auto workers, which is a big reason the UAW has cautiously supported Trump’s 25% tariffs, especially on Mexican-made vehicles and parts.

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Workers are betting that Trump’s tariffs will result in only temporary discomfort for the stock market and consumers while bringing back better jobs and wages. Trump signed an executive order aboard Air Force One as he flew to the Michigan rally easing some of his auto tariffs, which are scheduled to go into effect May 3.

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Regional Divide

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There are no guarantees that automotive jobs will return to Michigan and other states where the UAW has the greatest presence. While the tariffs are pushing foreign automakers to bring some production to the US, so far such moves are mostly targeting right-to-work states and plants without unions in the Southeast.

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Mercedes-Benz Group AG said Thursday that it would produce “a core vehicle” at its plant in Alabama, while South Korea’s Hyundai Motor Co. plans to invest $21 billion in its southern plants. Honda Motor Co. said in April that it will build its Civic hybrid in Indiana as a result of tariffs.

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Another obstacle for Trump’s promise to revitalize the manufacturing economy is the still very low unemployment rate. Swamy Kotagiri, chief executive officer of the Canada-based automotive interiors maker Magna International Inc., said it’s tough to move plants to the US.

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Moving an auto seat plant, for example, could create the need to fill thousands of positions and invest billions of dollars in new infrastructure. Kotagiri said workers in his plants in Mexico take hides from Texas and cut and sew them into leather seats. That’s not unskilled work, he said.

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“It’s not easy to get skilled labor,” Kotagiri said in an interview. “That’s a concern.”

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UAW President Shawn Fain has praised Trump for taking action on what he called a “broken free trade system.” The UAW released a report on April 30 saying that the U.S. auto industry has capacity to build more than 14.7 million vehicles, but that it produced just 10.2 million last year.

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While there has been a vocal contingent of unionized auto workers backing Trump, there are also UAW members who are less eager to give the president their full-throated support. Plenty are skeptical of Trump and wary of inflation, according to Mike Spencer, president of UAW Local 1700, which represents the roughly 5,800 workers at a Stellantis plant in Macomb County.

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“The folks that support Trump, they’re there,” Spencer said. But other UAW members are “taking a very, very cautious look at the whole picture, because it’s not just about the automobile industry. It’s the cost of eggs, the cost of the housing market, whether it’s falling through the sky or not, so a lot of factors that contribute to your quality of life along with your job.”