[Related to the Chapter Opener on page 2] According to
an article on reuters.com, Fiat Chrysler Automobiles, the
firm that sells Dodge and Chrysler cars and trucks in the
United States, decided to invest $1 billion to modernize
two of its U.S. production plants. The article described the
possible effect of President Trump’s trade policies on Fiat
Chrysler’s decision.
a. What trade policies was the article referring to? How
would those policies affect Fiat Chrysler’s decision
about whether to expand production in the United
States?
b. The article also implied that Fiat Chrysler’s decision
might have been affected by the possibility that the
Trump administration will relax environmental
regulations, such as a rule requiring companies to
increase their cars’ miles per gallon, and attempt to
reduce the taxes corporations pay on their profits.
Why would these two factors affect Fiat Chrysler’s
decision?
c. Which groups are likely to gain, and which groups are
likely to lose as a result of Fiat Chrysler’s decision to
produce more cars in U.S. plants rather than in overseas plants?
Source: Bernie Woodall and David Sheparhson, “Fiat Chrysler to
Add U.S. Jobs as Trump Puts Spotlight on Industry,” reuters.com,
January 9, 2017.