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Trump’s Nafta Victory Rides on Big Changes to How Cars Are Built

  • U.S. auto deficit with Mexico is wider than overall trade gap
  • Car industry is at center of Nafta trade debate: BoA analyst
Operations Inside Kia Motors Corp.'s Factory Amidst Political Dispute Stalling Production
Photographer: Susana Gonzalez/Bloomberg

To President Donald Trump, America’s $500 billion trade deficit is a symbol of economic weakness. If he wants a revamped North American Free Trade Agreement to shrink that number, he’ll need a seismic shift in how cars are made on the continent.

With negotiations expected to start in August, makers of everything from toys to microchips are making their case for how the Trump administration should reshape the 23-year-old trade accord with Mexico and Canada. Based on the president’s zeal for reducing the deficit, the auto industry could hold the key to U.S. success in the talks. Trump has threatened to walk away from Nafta if he can’t get better terms.