Cozying up to Trump has its advantages
Ford has backed off its plan to build a $1.6 billion factory in San Luis Potosi, Mexico. The news has been hailed as directly correlated to President-elect Donaly Trump’s criticism of the company—a dubious claim, at best. The now-canceled Mexico plant was set to move forward with Ford’s strong upcoming commitment to electric vehicles.
“The cars are among 13 new global electrified vehicles to be introduced in the next five years,” reports The Detroit News. In 2015, Ford said it would be investing $4.5 billion in electrified vehicles by 2020. The reversal also includes a $700 million investment in its Flat Rock, Michigan, facility; a move that will likely save upwards of 700 jobs for the area.
Trump was quick to claim victory at the news. A large part of the agenda that he ran on was resurrecting a dormant U.S. manufacturing sector deeply hurt by automation and the rise of import competition with China in the 2000s. Despite Trump’s insistence, Ford CEO Mark Fields told CNN Money that the company did not “cut a deal” with the president-elect. Rather, the automotive behemoth had plans to expand U.S production regardless of the incoming administration, Fields told Reuters. Further, he had this to say.
"Our view is that we see a more positive U.S. manufacturing business environment under President-elect Trump and the pro-growth policies and proposals that he's talking about, so this is a vote of confidence for President-elect Trump and some of the policies that they may be pursuing."
Trump has been advocating heavy tariffs on companies that do not manufacture inside the United States since the beginning of his campaign. To that end, he’s used Twitter to broadside companies that have taken some of their business overseas. Ford is only the latest example, though, of fabrications emanating from the Trump camp in reference to the specifics of these companies’ plans. Trump claimed he’d levy large penalties on Ford’s sale of Chevy Cruzes built in Mexico and sold in the United States. According to Reuters, only 2.4 percent of Chevy Cruzes manufactured in Mexico were sold in the United States in 2016.
In November of 2016, Trump took credit for saving some 1100 Carrier jobs in a bid to stop parent company United Technologies from moving some of its operation to Mexico. That number went down to 700 after Chuck Jones, leader of United Steelworkers 1999 representing Carrier employees, came out and accused Trump of “lying his ass off” about the amount of jobs that would be saved.
To add insult to injury, United Technologies CEO Greg Hayes told CNBC that the $16 million investment into their Indiana factory will go toward automation, allowing Carrier to stay competitive in the near term, while resulting in fewer jobs in the long term.
Trump also likes to take credit for decisions that businesses make in which he has absolutely nothing to do with. As it stands, Trump’s attempts to “save” U.S manufacturing through deal making with companies may be mere theatrics.