Industry braces for Trump presidency

WASHINGTON—In the first three weeks of his administration, President Donald Trump issued 23 executive orders. Among these were:

• Freezing all federal regulations pending approval by the Trump administration;

• Ordering regulatory agencies to identify two regulations to repeal for every one they promulgate;

• Canceling the Trans-Pacific Partnership, a trade agreement the Obama administration negotiated with 11 other Pacific countries;

• Allowing the Department of Health and Human Services and other agencies to waive or delay the implementation of any Affordable Care Act provisions they deemed as imposing a financial burden on states or individuals;

• Expediting environmental reviews on high-priority infrastructure projects;

• Temporarily suspending the entry into the U.S. of all "immigrants and non-immigrants" from Iraq, Iran, Libya, Sudan, Yemen, Somalia and Syria, though this order has faced legal hurdles;

• Instructing the Commerce Department to contact stakeholders to review the impact of federal regulations on domestic manufacturing; and

• Announcing a "get-tough" policy on immigration, including the prioritization of undocumented immigrants for expulsion from the U.S.; hiring 10,000 new immigration officers; and denying federal funding to cities that designate themselves as "sanctuary cities."

These orders are in addition to Trump's previously announced plans to repeal and replace the Affordable Care Act; to enact a trillion-dollar infrastructure improvement program; to renegotiate the North American Free Trade Agreement; and to charge high taxes and tariffs on goods imported from Mexico and from other countries.

Officials from the tire and rubber industries and allied sectors—including general manufacturing, scientific and small business associations—have varied reactions to Trump's orders and announced policies, ranging from apprehension to enthusiasm.

For example, the National Federation of Independent Business said its survey of small business optimism reached its highest level in January 2017 since December 2004.

"We've had very low growth for years, mainly because small businesses have been tied down by regulations, taxes, and spiraling health insurance costs," NFIB President and CEO Juanita Duggan said in announcing the survey results. "Now they can see relief on the horizon, and they are much more optimistic about the future."

On the other hand, the Alliance for American Manufacturing said it plans to hold Trump accountable for his promises to bring manufacturing jobs back to the U.S.

The AAM wrote Trump just before his inauguration, urging him to pursue policies that promote domestic manufacturing. Trump's "Buy American" and tax reform pledges were very encouraging to the AAM and its members, the association said.

The AAM has launched a new feature on its home page to track manufacturing employment, the trade deficit and industrial capacity utilization, according to a Jan. 26 blog by AAM Digital Media Director Elizabeth Brotherton-Bunch.

"We'll keep a close eye on these over the next four years, and we'll regularly provide analysis and criticism when necessary," Brotherton-Bunch wrote.

Company reactions

Many tire and rubber manufacturing companies declined comment for this article. Others, such as Bridgestone Americas and Cooper Tire & Rubber Co., answered cautiously.

"Our No. 1 priority is to meet the needs of our customers and to get them the products that they need to grow their businesses," Bridgestone Americas said.

"As you would expect, we're monitoring the current situation with the new administration," the Nashville-based tire maker said. "It will take some time to assess and understand the plans they have and any changes that are to come."

Findlay, Ohio-based Cooper was even more guarded. "Cooper believes our global manufacturing footprint positions us well to compete in the global tire business," it said. "This includes our near-sourcing strategy, under which the majority of the products sold to customers in a region are produced in a region."

One manufacturer who is hopeful about the Trump administration is Jeff Leach, co-president and chief operating officer of Wayne, N.J.-based Passaic Rubber Co.

"It's really too soon to tell, but we are very encouraged," Leach said. "We think he will be very proactive for small business. The jury's still out, but we as a small business are very excited."

But Richard A. Balka, president of Trenton, N.J.-based Home Rubber Co., had more reservations.

"I just returned from a trade show," Balka said. "The industry tends to be conservative, and most of the feedback I heard there was that people are happy with Trump."

Many rubber product manufacturers sell products to the oil and gas industry, according to Balka. "There's a sense that the oil and gas market is really going to open up, after years of not much going on," he said.

However, Balka was not sure the Trump administration's crackdown on immigration would be an unmixed blessing.

"We are in the Northeast, and we have a substantial immigrant work force," he said. "We have trouble finding good people who want to work in a factory and who are not first-generation immigrants.

"There just aren't simple answers for a lot of the problems," he said. "Immigration needs to be addressed in a holistic manner."

Balka also had reservations about Trump's "two-for-one" executive order on regulations.

"In theory, it sounds like it makes sense, but I'm concerned it's not necessarily an implementable philosophy," he said.

Plymouth, Mich.-based Freudenberg North America L.P. said it works closely with customers around the world and establishing facilities close to them—including customers in Mexico, where Freudenberg has been manufacturing since 1961.

"Free trade in North America has been a key consideration in the development of our strategy for the region, and has led to investments in both the U.S. and Mexico," a Freudenberg spokeswoman said. "It remains to be seen what a potential NAFTA renegotiation really means, but changes to NAFTA could affect our supply chain, especially in our automotive OE markets."

As a global technology company, Freudenberg relies on a culturally diverse team of employees that travels worldwide to provide innovations and solutions to customers, the spokeswoman said.

The company is not aware of any specific problems to its employees because of the Trump administration's immigration policies, but is monitoring the situation and will examine potential issues on a case-by-case basis, she said.

Association reactions

Trump's two-for-one regulatory order provides an opportunity to review regulations that are outdated or duplicative, according to Daniel Zielinski, senior vice president of public affairs for the Rubber Manufacturers Association.

"If a regulation has costs and burdens but no positive benefits, why keep it?" Zielinski said.

For example, the decades-old Uniform Tire Quality Grading System could be seen as redundant in the face of the pending consumer information and labeling portions of the tire fuel efficiency final rule, according to Zielinski. But Trump's executive order placing a freeze on regulatory activity has left this in a suspended state, he said.

Roy Littlefield, executive vice president of the Tire Industry Association, also said his members had a lot of hope for the two-for-one regulatory order.

"There are approximately 83,000 federal regulations, 60,000 of which we don't even use anymore," Littlefield said.

In general, TIA is very hopeful about the Trump administration, according to Littlefield.

"There are a lot of issues we're working on that will finally go through, and that's a plus," he said. One of those issues is potential repeal of the estate tax, a major goal of TIA for many years.

The American Chemical Society, parent association of the ACS Rubber Division, is not primarily a political organization, but does get involved in issues that affect its mission and its members.

In late January, the ACS responded to the Trump administration's order on visas and immigration, as well as reports that the administration was changing scientific communication policies and grant procedures.

"Science and scholarship flourish when scientists collaboratively pursue and publish research and communicate without externally imposed impediment, limitation or restriction," the ACS said.

"It is important for organizations that represent scientists and engineers to advocate the most open and fair exchange among scientists without limitations imposed by national and global political concerns."

On Jan. 31, the ACS joined 150 other scientific organizations and universities in signing a letter to Trump, protesting his order restricting visas and immigration.

"Scientific progress depends on openness, transparency and the free flow of ideas and people," the letter said. "The executive order will discourage many of the best and brightest international students, scholars, engineers and scientists from studying and working, attending academic and scientific conferences, or seeking to build new businesses in the U.S.

"Implementation of this policy will compromise the United States' ability to attract international scientific talent and maintain scientific and economic leadership," it said.

The ACS does not know of any specific instance of any of its members or any other scientists being denied entry into the U.S. because of the executive order, according to a spokeswoman.

"We are, however, seeing some impact on attendance for our upcoming national meeting in San Francisco in April," she said. "We have had six people cancel so far because of the travel ban."

Three of those who canceled come from one of the seven countries specifically named in the immigration ban, she said.