Foreign-Based Company CEOs Meet Trump to Plead their Tax Case

The heads of Airbus and Samsung's U.S. units stressed that more open trade arrangements facilitated almost $400 billion of local investment last year alone.

The chiefs of the American arms of a dozen big foreign companies, including Airbus, Panasonic and Samsung, have met with Donald Trump to highlight the amount of money they invest in the country and plead for care with any looming tax tinkerings.

The fact that Trump has been open to spending time with the CEOs could be seen as a welcome sign for the many concerned he’ll impose high tariffs on imports, potentially making their products less competitive. There’s been little indication so far, though, that the president is willing to substantially soften his protectionist stance.

Airbus, for example, may lose ground to archrival Boeing, should the American company’s operations receive more favorable treatment from the administration. It’s not entirely clear how much Trump’s tax plans would impact foreign companies such as Airbus that are based overseas, but still make some of their products at factories in the U.S.

“OUR SUPPLY CHAINS EXTENDS TO JAPAN TO SPAIN TO MEXICO. YOU CAN’T JUST SAY, ‘WE CAN DO EVERYTHING’ IN ONE COUNTRY.”

Airbus, based in Toulouse, France, opened its first ever U.S. manufacturing facility in Mobile, Alabama in September, 2015. The plant is expected to produce between 40 and 50 single-isle A319s, A320s and A321s per year by 2018 and was intended to bring Airbus closer to its U.S. customers and component suppliers.

Still, should one of its U.S. customers want a larger, wide-body jet, such as an A330 or double-decker A380, the product would have to be imported.

House Republicans are suggesting the government fund a headline corporate tax cut by imposing a 20% “border-adjustment tax” that could perhaps sting products such as an Airbus A380. Exports, meanwhile, would be rendered tax free, giving Boeing a new competitive edge.

“We’re all facing a much stronger populist environment,” said Nancy McLernon, president of the Organization for International Investment, which organized the meetings, according to AP. “We want to ensure that foreign investment in the United States is not a blind spot.”

Foreign direct investment in the U.S. amounted to $396 billion in 2016, up 12% from 2015, according to the U.S. Bureau of Economic Analysis.

Panasonic America CEO Joseph Taylor said the line between products made overseas and at home isn’t always clear, given the complexity of global supply chains. One product, for example, might have some components made in America and others made in China or Mexico.

“Our supply chain extends to Japan to Spain to Mexico,” Taylor said. “You can’t just say, ‘We can do everything’ in one country.”

The failure of Trump’s healthcare legislation has brought tax reform to the forefront of his policy agenda. He is hoping to overcome divisions among lawmakers and CEOs about the need for a border-adjustment tax and push reform through by August.


MORE LIKE THIS

  • Get the CEO Briefing

    Sign up today to get weekly access to the latest issues affecting CEOs in every industry
  • upcoming events

    Roundtable

    Strategic Planning Workshop

    1:00 - 5:00 pm

    Over 70% of Executives Surveyed Agree: Many Strategic Planning Efforts Lack Systematic Approach Tips for Enhancing Your Strategic Planning Process

    Executives expressed frustration with their current strategic planning process. Issues include:

    1. Lack of systematic approach (70%)
    2. Laundry lists without prioritization (68%)
    3. Decisions based on personalities rather than facts and information (65%)

     

    Steve Rutan and Denise Harrison have put together an afternoon workshop that will provide the tools you need to address these concerns.  They have worked with hundreds of executives to develop a systematic approach that will enable your team to make better decisions during strategic planning.  Steve and Denise will walk you through exercises for prioritizing your lists and steps that will reset and reinvigorate your process.  This will be a hands-on workshop that will enable you to think about your business as you use the tools that are being presented.  If you are ready for a Strategic Planning tune-up, select this workshop in your registration form.  The additional fee of $695 will be added to your total.

    To sign up, select this option in your registration form. Additional fee of $695 will be added to your total.

    New York, NY: ​​​Chief Executive's Corporate Citizenship Awards 2017

    Women in Leadership Seminar and Peer Discussion

    2:00 - 5:00 pm

    Female leaders face the same issues all leaders do, but they often face additional challenges too. In this peer session, we will facilitate a discussion of best practices and how to overcome common barriers to help women leaders be more effective within and outside their organizations. 

    Limited space available.

    To sign up, select this option in your registration form. Additional fee of $495 will be added to your total.

    Golf Outing

    10:30 - 5:00 pm
    General’s Retreat at Hermitage Golf Course
    Sponsored by UBS

    General’s Retreat, built in 1986 with architect Gary Roger Baird, has been voted the “Best Golf Course in Nashville” and is a “must play” when visiting the Nashville, Tennessee area. With the beautiful setting along the Cumberland River, golfers of all capabilities will thoroughly enjoy the golf, scenery and hospitality.

    The golf outing fee includes transportation to and from the hotel, greens/cart fees, use of practice facilities, and boxed lunch. The bus will leave the hotel at 10:30 am for a noon shotgun start and return to the hotel after the cocktail reception following the completion of the round.

    To sign up, select this option in your registration form. Additional fee of $295 will be added to your total.