January 15, 2017 — Two words best describe this year’s Detroit Auto Show — Trump and autonomy. The vehicles? They were nearly an afterthought during press days at the North American International Auto Show (the show’s official moniker).

Despite coming on the heels of a second consecutive record breaking year for sales, the mood on the show floor was far from celebratory. Blase is a better description. Other comments made by people at the show included, words such as “A dud,” “quiet,” and “dead.” The auto show in Los Angeles held in November was equally dead.

To be fair, the success of an auto show shouldn’t be measured by the perspective of jaded journalists, but by the number of the buying public paying to see the vehicles — we’ll have that metric in a couple of weeks when the Detroit show closes. Attendance was strong Saturday, the first day the show was open to the public. More than 100,000 people came to look at the cars, 2,000 more than the opening day in 2016.

Nevertheless, the focus of the news last week was less about the cars and more about President-elect Trump’s potential trade policies along with the continued mad rush toward all things involving autonomy and mobility.

Where are the Cars?

There were only 13 press conferences — all of them on Monday — showing off new vehicles, most of which were either refreshes or redesigns of current models. Past shows included at least two full days of automaker press conferences. The one surprise came from Kia when it unveiled its rear-wheel drive sedan it is calling Stinger. Kia has been promising a real-wheel drive sedan for a while — the real surprise is that it is positioning the Stinger as a BMW 3-Series fighter.

The other notable reveals included Toyota’s newly designed Camry – perhaps its best one yet; a new Lexus LS; a redesigned Honda Odyssey;  a GMC Terrain; and a new BMW 5-Series.

Also receiving attention was the I.D. Buzz from Volkswagen, a re-imagined concept of the iconic micro-bus. The concept was created mainly to show off VW’s future electric vehicle strategy, but with no guarantee the vehicle will ever see an assembly line. Although, company officials indicated a vehicle based on the platform could be built in 2022, which means, they have no idea, nor do they have plans to build it.

By our count, there were about 30 total new vehicles or variants shown at this year’s show. In 2016, automakers showed off approximately 50 new vehicles, and that was down from previous shows that included as many as 60 new reveals.

The lack of product news at this year’s show is nothing more than a pause in the action. The industry likely is on the downside of a cycle that included a frenetic pace coming out of the recession of designing and launching new vehicles. After seven years of fast-paced growth, most analysts and automakers predict sales to plateau, and even decline in the next couple of years. So it’s possible the lack of new reveals this year simply is indicative of an industry taking a deep breath following a frenzied period of product launches.

Another trend that began during the recession but has gained steam recently is the number of exotic brands staying away from the show. Detroit isn’t their market, but unfortunately, these brands have vehicles the public wants to see, if only to lust over. This year seven automakers  — Porsche, Maserati, Tesla, Rolls Royce, Bentley, Jaguar Land Rover and Mini — avoided Detroit. Not having their models on the show floor detracts from the overall excitement.

Meanwhile, Ford Motor Co. did generate some news confirming it is bringing both the Ranger midsize pickup (2019) and the Bronco SUV back to the U.S. by 2020. (Although details are still slim, Ford confirmed the Bronco would be based on the Everest platform which is used for the foreign-based Ranger. Read what TBR wrote in August 2015: Ranger’s Return?)

CES Becomes a Threat

As numerous tech firms not traditionally associated with the auto industry begin to make investments in the autonomous and connected vehicle arenas, the CES show in Las Vegas has become a critical showpiece the last two years. The problem for Detroit is that CES (formerly the Consumer Electronics Show) takes place the week before NAIAS. As a result, automakers have made announcements or unveiled new vehicles at CES the last two years that in the past, would have been made in Detroit. (One of the rumors floating around the show floor has CES and the Detroit Show falling on the same week in 2018).

In 2016, General Motors unveiled the Chevrolet Bolt at CES. This year, Fiat Chrysler Automobiles showed off its autonomous concept, the Portal, while Faraday Future took the wraps off its FF 91, a pre-production autonomous electric SUV.

By our count, at least nine automakers were on hand along with approximately 128 different companies with exhibits in the automotive section of the show. (For more: CES 2017 Wrap Up).

To counter the CES effect, the Los Angeles auto show changed the name of the show for its press days to Automobility LA this year. A tent outside the convention center housed an exhibition area for tech firms along with a conference area for presentations about autonomous technology and personal mobility.

Detroit following LA’s example, set up its own conference and exhibit area focused on mobility and autonomy, calling it Automobili-D. (Who could have ever predicted we would see a Facebook presentation at an auto show? At both the LA and Detroit shows, Stephanie Latham, U.S. director of automotive for Facebook, gave presentations on how automakers can leverage the vehicle’s connections to interact with today’s buyers.)

The mobility exhibits are a play by both the LA and Detroit shows to remain relevant venues showcasing the auto industry. But the challenge is that much of the real news regarding autonomous and connected technology is being announced at CES because that is the playing field for tech firms. It’s what they know and understand. BMW partnering with Intel and Mobileye; Audi and Nvidia’s hookup; Ford and Amazon’s Alexa; Microsoft with both Volvo and Nissan; and Nissan’s leveraging of NASA technology are examples of the real news announced during CES this year.

Detroit did manage, however, to convince Waymo to unveil its autonomous Pacifica as part of the Automobili-D conference, last Sunday. Over the next couple of years, Detroit has to snag more of these types of announcements from both the automakers and the tech firms.

But it is a bigger story than just the relevancy of the auto shows. It is reflective of the ongoing battle between the automakers and tech firms for control of the cockpit, and thus, control of the immense amount of data connected vehicles will spin off about their drivers. That data represents billions of dollars in revenue for whomever controls it. The next two to three years will determine who the winners and losers are.

The Trump Dynamic

Conversations about President-elect Trump’s trade possible trade policies dominated the conversation the first couple of days at the Detroit show — both in questions from journalists and in the subsequent off-the-record chats on the floor with various auto executives. While most automakers are encouraged by what appears will be a pro-business administration, there is deep concern about potential unfriendly trade policies — either in the form of tariffs as high as 35% against specific companies or a comprehensive border adjustment tax that is being championed by the GOP.

This conversation likely is a phenomenon unique to this year’s show as Trump’s tweets attacking automakers for building vehicles in Mexico (automakers building cars in Canada are up next)  along with moves from Ford and FCA have automakers scrambling to divine how the incoming administration will affect future and current initiatives.

Trump has used Twitter to attack companies such as Ford and Toyota for building vehicles in Mexico and importing them into the U.S. saying the practice steals jobs from the U.S. He has also threatened to levy hefty tariffs on automakers who insist on continuing to import vehicles into the U.S. and has criticized the North American Free Trade Agreement (NAFTA).

A couple of days before the start of the show, Ford announced it is canceling plans to build its third assembly plant in Mexico and instead use some of that money to transform its Flat Rock plant into an autonomous and electric vehicle showcase, while adding 700 jobs to the factory. (Ford Goes All Out with EV & Autonomous Strategy)

Sort of lost in the hype was the news that Ford still is moving its small car production to one of its other two Mexican plants. Although Ford likely had made the decision based on plunging small car demand, CEO Mark Fields gave President-elect Trump credit for his pro-business platform.

FCA used the Detroit show to announce it is investing $1 billion to modernize two plants in Ohio and Michigan along with adding 2,000 jobs in the U.S. CEO Sergio Marchionne, however, also addressed the uncertainty being created by the incoming administration’s statements on trade, saying the industry needs “clarity.” The timing of FCA’s announcement was set to blunt any pending tweets from Trump about FCA’s production practices, according to sources within the automaker.

Whether FCA decides to move production of its heavy-duty Ram pickup from Mexico to the U.S. likely depends on what the incoming administration does regarding trade.

In addition to attacking Ford on Twitter, Trump also recently went after General Motors for producing small cars in Mexico. President and CEO Mary Barra told reporters at the Detroit show the automaker will not change its production plans. It currently imports a small number of Cruze Hatchbacks from Mexico and will continue to do so. GM also plans to move production of the GMC Terrain from Canada to Mexico this year.

Toyota has also come under attack from Trump for plans to build the Corolla in Mexico. Toyota’s U.S. president Jim Lentz then announced in an interview with CNBC during the Detroit Show the automaker is investing $10 billion in the U.S. over the next five years on top of the $22 billion it has already invested.

Despite the concern over potentially harmful trade policies, most automakers are confident they can work with President-elect Trump to craft policies that that will take into account current business plans. Additionally. automakers say the are looking forward to an administration that likely will begin to dial back what has been an onerous regulatory environment the last eight years.