F Ford Motor Company

By Christina Rogers, Peter Nicholas and Mike Colias 

President Donald Trump told bosses of the Detroit three car makers that he would work to ease environmental regulations, cut corporate taxes and push for economic policies favorable to U.S. manufacturing, in an effort to mend fences with an industry he spent months criticizing.

In a breakfast meeting Tuesday, Mr. Trump pledged to speed up regulatory reviews for permits and create a friendlier climate for companies that want to invest in the U.S., stepping up his push to curb the flow of jobs overseas.

"We're going to make the process much more simple for the oil companies and everybody else that wants to do business in the United States," Mr. Trump said, in an hourlong meeting with General Motors Co.'s Mary Barra, Ford Motor Co.'s Mark Fields and Fiat Chrysler Automobiles NV's Sergio Marchionne.

The commander-in-chief also reiterated that companies would pay a steep price should they not comply with his "America First" credo, echoing his Twitter messages in recent months threatening to slap a border tax on companies moving factory work abroad.

At the start of the meeting, Mr. Trump pulled out the chair next to him for Ms. Barra, who recently joined his economic policy team, so she could sit down next to him. He went around the Roosevelt Room and asked everyone to introduce themselves, beginning with himself. "I'm Donald Trump," he said.

Before Tuesday's breakfast meeting, Mr. Trump tweeted: "I want new plants to be built here for cars sold here!"

Persuading car makers to add new factories will be a tall order, though. U.S. demand for cars and trucks is cooling, following seven years of uninterrupted growth. The Detroit car makers have been generally reluctant to build new auto-factories in the U.S., after spending years getting rid of old plants they didn't need, particularly during the bankruptcies of GM and Chrysler.

Most of the new plants built in the U.S. in recent years have been by foreign auto makers like Volkswagen AG and Toyota Motor Corp.

Mr. Trump, whose popularity with working-class voters helped propel him to the White House, has blasted the auto industry for importing cars for sale in the U.S., arguing it is coming at the expense of American jobs. That has put auto-industry executives on the defensive and led them to announce new investment in U.S. auto plants in recent weeks, even though some of the plans had been in the works for months or longer.

For much of his campaign, Mr. Trump targeted Ford, pointing to the company's plans for a new $1.6 billion factory in Mexico to build small cars currently produced in the U.S.

Ford has since scrapped those plans, opting to instead reinvest in its existing factories. More recently, Mr. Trump has turned his attention to other auto makers, including GM and Fiat Chrysler, both of which have large manufacturing operations in Mexico.

Mr. Trump emphasized during the meeting that he would streamline the process by which applicants win approval to do business in the U.S. and criticized current environmental regulations, describing them as unnecessarily burdensome.

Mr. Trump later Tuesday signed a pair of executive orders aimed at speeding up regulatory reviews for businesses seeking permits.

Following the meeting, Mr. Fields told reporters he was encouraged by the president's agenda and praised Mr. Trump for his decision to withdraw from a 12-nation trans-Pacific trade deal that had been championed by former President Barack Obama.

Ford has long blasted the deal for not addressing a substantial barrier to trade: currency manipulation. "We appreciate the president's courage to walk away from the bad deal," Mr. Fields said.

It is unclear whether Mr. Trump's intentions on trade were discussed. Auto executives in recent weeks have said they needed clarity from the president, who has talked in general terms about tariffs and border taxes but hasn't outlined specifics.

In a note to investors Tuesday, Barclays analyst Brian Johnson said the Trump administration could use relief from tougher fuel-economy regulations as a bargaining chip to encourage car companies to expand U.S. manufacturing.

Car companies are spending billions to comply with the regulations set under the Obama administration and expected to tighten considerably through 2025. Mr. Johnson said that if those regulations were relaxed, the estimated savings by auto makers could free up capital investment to support anywhere from 200,000 to 400,000 new U.S. jobs.

Auto executives are still awaiting details of specific trade policies, including what exactly Mr. Trump means by a "border tax" and if it will be similar to a border-adjusted tax proposed by House Republicans.

The tax, part of a broader corporate-tax blueprint outlined by Republican leaders, would essentially apply a corporate tax to imports and remove it for exports, incentivizing firms to build more goods at U.S. factories.

Mr. Fields, Ford's CEO, has described the idea as "interesting", noting that Ford is a major U.S. exporter of vehicles. The company also builds 78% of the vehicles sold here at U.S. factories, including its top-selling and highly lucrative F-series pickup trucks, according to WardsAuto.com.

However, such a tax would hurt car companies that import a higher percentage of vehicles sold in the U.S. and deal a blow to the auto-industry supply chain, much of which spans borders. Mexico, for instance, sent an estimated $63 billion worth of auto parts to the U.S. in 2016, according to the U.S. International Trade Commission.

Write to Christina Rogers at christina.rogers@wsj.com, Peter Nicholas at peter.nicholas@wsj.com and Mike Colias at Mike.Colias@wsj.com

(END) Dow Jones Newswires

January 24, 2017 16:34 ET (21:34 GMT)

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