Welcome to the Daily 5 report for Monday, Aug. 25.
One sentence in the U.S.-European Union trade framework announced last week probably elicited this response from automakers on both sides of the pond: "Is this FOR REAL?"
The joint statement sentence in question: "With respect to automobiles, the United States and the European Union intend to accept and provide mutual recognition to each other's standards."
If this actually happens — and that is a massive "if" — the precedent would represent a sea change in how motor vehicles are built and exported around the world.
So it's no surprise that no automaker would initially touch this pronouncement publicly with a 10-foot pole.
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As Richard Truett and our team reported Aug. 22, the joint statement raises more questions than answers as the U.S. and EU negotiate details of this framework.
Would the Detroit 3 even try to export U.S.-made vehicles to Europe and beyond that don't comply with regional regulations? The marketing challenges for trying to convince Europeans to drive American-made vehicles on their roads seem overwhelming.
"While I'm sure the Trump administration believes that this means Europeans would suddenly start buying hundreds of thousands of full-size, gas-guzzling trucks and SUVs, the market realities are that those consumers are no more likely to do so than are Japanese and Koreans," Sam Abuelsamid, vice president of market research at Telemetry, told us.
On the other hand, American innovation is valued around the world, and a smart U.S. automaker might find creative ways into Europe and other markets — particularly for electric or other zero-emission vehicles.
"Cadillac has been talking a lot recently about expanding its presence outside of the U.S. and EVs being a key part of that effort," Abuelsamid said.
Our story brings up numerous other mind-numbing questions about the preliminary U.S.-EU agreement, but it is clear that this concept is on the table. And it's for real.
In other news, check out our comprehensive report on upcoming products from Ford Motor Co. For all the other Future Product Pipeline reports, go here.
We also released our 2025 list of Automotive News All-Stars.
And be sure to check out this year's automotive executive compensation report.
That's it for today. If you want to see this story in your browser, click here.
— Philip Nussel, online editor
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