Volkswagen Group of America CEO Hinrich Woebcken took an unambiguous stand against the types of protectionist trade policies being put forth by the Trump administration and said he personally lobbied Vice President Mike Pence on the subject just three weeks ago in Tennessee.
"There is no winner with protectionism," Woebcken told an audience of dealers gathered here for the 48th annual American International Automobile Dealers Association luncheon. "Free trade is what we need for this industry."
Woebcken oversees Volkswagen's North American region, which covers not only its sales operations, but its manufacturing plants in Chattanooga and Puebla, Mexico, as well as research, engineering, marketing and other operations on both coasts of the United States as well as in Michigan and other regional locations. He said automobile manufacturers and suppliers have set up their operations over the last several decades under trade policies that made those investments possible.
"All of these international car companies in this country really are industrializing and generating a lot of jobs in America," Woebcken said, saying Volkswagen Group alone was responsible for as many as 120,000 direct and indirect jobs in the United States, including dealerships and suppliers.
"All these big investments in this country, in the deep South for instance, with BMW in Spartansburg, (S.C.) Mercedes-Benz in Tuscaloosa (Ala.), Hyundai in Montgomery, Ala., Volkswagen in Chattanooga, Tenn. -- all those investments, all those jobs would not have been coming to reality without NAFTA, without a strong supply base also from Mexico."
Woebcken said the North American Free Trade Agreement, which is currently being renegotiated by the Trump administration, is foundational to the continued successful operations of international automakers' plants in the United States.
"I've been in teams evaluating these kind of businesses cases, and sometimes that is really a tipping point. Someone said it earlier, our industry is really very, very sensitive, and 1 percent difference in a business case point could mean that this factory is located instead in the Czech Republic or something," Woebcken said.
The CEO said he had "a chance to discuss" trade issues with Pence at a meeting with the National Republican Governors Association in Nashville about three weeks ago and expressed his opposition to protectionist trade policies.
You can reach Larry P. Vellequette at lvellequette@crain.com -- Follow Larry P. on Twitter: @LarryVellequett
