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Detroit, Michigan Remarks to Reporters Following a Meeting With Automobile Industry, Representatives.

American Government Special Collections Reference Desk

American Government

Detroit, Michigan Remarks to Reporters Following a Meeting With Automobile Industry, Representatives.

President Jimmy Carter
July 8, 1980


Good morning, everybody. I think it's obvious to those who are interested in the American economy and particularly interested in the automobile industry that this is indeed an historic meeting. Eight weeks ago, we invited the leaders of the different American manufacturing companies for automobiles, plus Doug Fraser and representatives of the UAW, to come to the Cabinet Room to discuss what we might do to help the American automobile industry make the transition phase over to accommodate the changed consumer preferences brought about by unanticipated increases in energy price.

As you know, we've now been working for 8 weeks, literally day and night, with the industry and labor leaders to prepare a package of proposals that would help this industry. I'm deeply concerned about the adverse impact on communities where the automobile industry is a major factor in employment. I'm particularly grieved and concerned about the very high unemployment rate in the industry now.

We want to move as rapidly as we possibly can to correct any problems that can be corrected through Government action and joint action with the industry itself. We will make changes in prospective regulations that would add about $500 million to the cash flow of the American automobile manufacturers. We will also provide about $50 million or so, perhaps more than that, in special assistance for communities that have high unemployment rates brought about by the changes being made in the automobile industry. Through the Small Business Administration we'll provide whatever is necessary-between $200 million and $400 million-for dealers, in guaranteed loans which might be necessary for them to keep their stock and trade adequate.

Later on this year, perhaps in the next few weeks, I'll be visiting personally some of the manufacturing plants that produce the extremely high quality, fuel-efficient automobiles brought about by the rapid retooling that is taking place in the American automobile industry. The Treasury Department will help by taking cognizance of the fact that because of rapidly changing consumer preferences, there is an economic obsolescence in some of the tools and equipment being used to manufacture automobiles. In other words, there will be a faster depreciation permitted, which is completely proper under the law for this purpose.

In addition to that, when economic conditions do permit, in the future when we show an adequate self-discipline by restraining Federal expenditures, and when we work out a proposal that can be anti-inflationary in nature, and propose to the Congress a general tax reduction plan, the automobile industry will obviously have consideration to meet its special needs.

I might point out that perhaps the most important thing to remember today is that this package of proposals—that has been worked out jointly with the industry and with the UAW and with the Federal Government-is just a first step. We will set up an automobile industry committee that will continue to provide some assistance, which is completely proper, compatible with the free enterprise system that we cherish, conducive to high competitiveness within the industry, and we will not in any way violate our commitment to high air standards, air quality standards, nor to efficiency.

It's obvious that the competitive nature of the international automobile industry is much more restrictive in this respect now than any Government regulations. But we will be very cautious in the future in implementing new regulations to make sure that they are conducive to a strong, vital automobile industry in our country and not derogate in any way the air quality standards nor the efficiency standards that are necessary.

And finally, let me say that I have asked, or will ask, the ITC, Trade Commission, for an expedited ruling on whether or not imports of automobiles into this country have adversely affected or improperly affected the industry in our country. This does not prejudge what their finding might be, and it does not prejudge what action I will take when I get a recommendation from them. But because of the importance of this industry and the needs at this time, it's important to me, as President, to have a quick ruling, after adequate time is given for the hearings and investigation, from the ITC.

We have formed, in effect, a very close-knit, permanent partnership, within the bounds of propriety for our free enterprise system, between the Government itself and the automobile industry—representing labor, manufacturing, perhaps automobile parts, and perhaps even the dealers. And I believe that this will be a major step forward in providing for the American consumer the extremely high quality, fuel-efficient automobile which will be required in the months and the years ahead.

I would like to express my thanks to the representatives of all the automobile manufacturing plants who are here—the chairmen of the board and the presidents of all of them are present—to Doug Fraser and his vice presidents who've assembled with us, and to the leaders of our Transportation Department, the Treasury Department, our Special Trade Representative, and those others who are associated with me representing the Federal Government.

The mayor of Detroit is here, Coleman Young. The Michigan delegation is here; I think en massй. And I'm deeply grateful that they would get up this early in the morning on such an important consideration. We're all in it together, and I have great hopes and expectations that the automobile industry of our country will make strides in the future that will be pleasing to all of us. We are now producing in our country roughly 1 1/2 million of the small, fuel-efficient automobiles. It's anticipated that by 1983, a very short time in the future, we'll be producing in the neighborhood of 7 1/2 million of these automobiles that will be required by the American consumer. This is a major goal. It's one that we will meet, I believe, with this kind of cooperation guaranteed among us.

Thank you very much for being with us this morning. It's an important day in the life of our country. Thank you very much.

Note: The President spoke at 7: 52 a.m. in the lounge of the Michael Berry International Terminal at the Detroit International Airport following the meeting which was also held in the terminal.

After his remarks, the President boarded Air Force One for the flight to Japan, with a short stop in Anchorage, Alaska.

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