Toyota has a better option than Twitter to take on Trump

Sydney — The world’s auto industry must be feeling nostalgic about the days when what was good for General Motors Co. was good for America.

The threat: import duties

President-elect Donald Trump’s Twitter feed has praised Ford Motor for "scrapping a new plant in Mexico" and threatened GM with a "big border tax" on imported Chevies.

Then on Thursday he told Toyota Motor it faces import duties if the company builds a new plant south of the border, driving the stock down as much as 3% in Tokyo and marking a first shot across the bows of foreign car makers.

Leaving to one side the spiralling debates about the facts of these statements, the current situation is still perilous for the industry.

Getting into a Twitter spat is never a great idea — least of all with @realDonaldTrump. And while companies might grumble about whether the collateral damage to their public images is justified, brazening it out in a war with the president is rarely a viable strategy in a consumer-focused industry: Remember that thing about how the customer is always right?

In case of any doubt about this, look what happened to BP’s US retail network after the 2010 Deepwater Horizon oil spill. The disaster didn’t affect the price or quality of BP’s petrol, but the number of retail sites in the country dropped by about 40%.

Whether Donald Trump likes it or not, the US automotive industry is deeply integrated with cross-border trade. About one-third of the passenger vehicles sold in the US are imports, according to figures from the Department of Commerce, and two-way trade in parts and finished cars amounts to more than $450bn a year.

That scale of integration puts the industry between a rock and a hard place. Try to fight the tide of presidential disapproval, and you end up like King Canute, but taking pre-emptive action to avoid it is inconceivable.

Even the most cautious manufacturer won’t disrupt multibillion-dollar global supply chains it has spent decades building out of fear of a tweet.

There is another way. The industry tends to be surprisingly modest in its outlays on lobbying: it spent less during 2015 than the civil service, the entertainment industry, real estate or education, according to the Centre for Responsive Politics.

Relative to the giants of corporate influence in Washington, such as pharmaceuticals, insurance, electrical utilities, electronics manufacturing, and oil and gas, it’s a minnow.

Such outlays can be a useful way of shaping policy. When the growth of unconventional shale resources brought the energy industry into conflict with farmers and householders in the late 2000s, oil and gas companies and associations sharply ramped up spending in Washington, to ensure the playing field was skewed in their favour.

Car makers as a whole have been smaller players in lobbying because they’ve often been able to lean on the grassroots influence of their dealership networks, which have a presence in pretty much every congressional district. In the years after the 2009 bankruptcies of General Motors and Chrysler, too much money spent lobbying the government that bailed out Detroit also risked looking unseemly.

Those times are past. Car makers’ best defence now against executive actions and rhetoric from a Trump White House is a Congress that is firmly on their side. Ethics aren’t at quite such a premium in Washington these days, and the auto industry is in a fight for survival, so it can’t afford to be picky. It’s time to join the swamp.

• Fickling is a Bloomberg Gadfly columnist covering commodities, as well as industrial and consumer companies.

This column does not necessarily reflect the opinion of Bloomberg LP and its owners.

Bloomberg