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Trump Threatens Automakers; Ford Cancels Mexico Plans

<p>Trump has repeatedly told us that he plans to punish companies that manufacture goods overseas&period; In fact&comma; he recently announced that the two &ldquo&semi;golden rules&rdquo&semi; for his presidency are <strong>buy American&comma; hire American&period;<&sol;strong><&sol;p>&NewLine;<p>In June&comma; General Motors announced that it would utilize &ldquo&semi;existing production capacity in Ramos Arizpe&comma; Mexico&comma; to supplement production at its plant in Lordstown&comma; Ohio&rdquo&semi; in order to meet consumer demand&period;&nbsp&semi;<&sol;p>&NewLine;<p>This Tuesday&comma; Trump issued a no-nonsense threat to GM&colon; Make the Chevy Cruze in the US or face a &ldquo&semi;big border tax&period;&rdquo&semi;&nbsp&semi;<&sol;p>&NewLine;<p>GM explained that while the Cruze hatchback &ndash&semi; designed primarily for international markets &ndash&semi; is made in Mexico&comma; the sedan version of the Cruze is manufactured in Ohio&period;&nbsp&semi;<&sol;p>&NewLine;<p>GM sold over 16&comma;000 Cruzes in the US in November&comma; about 1&comma;600 of which were made in Mexico&period; The company has about 100&comma;000 employs in the US and about 15&comma;000 in Mexico&period;&nbsp&semi;<&sol;p>&NewLine;<p>Trump has warned automakers that he plans to levy a 35&percnt; tax on cars manufactured in Mexico for the US market&period; PB predicts this threat will lead to negotiations and that the actual border tax will be less severe&period;<&sol;p>&NewLine;<p>General Motors&comma; Toyota&comma; Honda&comma; Ford&comma; and Volkswagen all have plants in Mexico&period; Ford has about 8&comma;800 employees in Mexico&comma; which is about 10&percnt; of the number it has in the US&period;&nbsp&semi;<&sol;p>&NewLine;<p>Hours after Trump issued his threat to GM&comma; Ford announced that it would be cancelling plans to build a &dollar;1&period;6 billion plant in San Luis Potos&iacute&semi;&comma; Mexico&period; Instead&comma; it will invest &dollar;700 million to increase production in Flat Rock&comma; Michigan&period;&nbsp&semi;<&sol;p>&NewLine;<p>Employees in Michigan were overjoyed by the announcement&period; &ldquo&semi;I don&rsquo&semi;t know if you can really understand the impact of this investment&comma;&rdquo&semi; said Jimmy Settles of the United Auto Workers union&period; &ldquo&semi;This is the equivalent to a new assembly plant&period;&rdquo&semi;&nbsp&semi;<&sol;p>&NewLine;<p>Ford CEO Mark Fields says the expansion will focus on hybrid and electric vehicles&comma; including a new battery-powered sport utility vehicle&period; &ldquo&semi;We are encouraged by the pro-growth policies that President-elect Trump and the new Congress have indicated they will pursue&comma;&rdquo&semi; said Fields&period; &ldquo&semi;And we believe that these tax and regulatory reforms are critically important to boost U&period;S&period; competitiveness&comma; and&comma; of course&comma; drive a resurgence in American manufacturing and high-tech innovation&period;&rdquo&semi;<&sol;p>&NewLine;<p>Fields says Ford is proud to be a &ldquo&semi;global&comma; multination&comma; company&comma;&rdquo&semi; but that &ldquo&semi;our home also is here in the United States&&num;8230&semi; We are the number one manufacturer of vehicles in the US and we employ more hourly automotive workers than any in the US&period; This will help build on that&period;&rdquo&semi;&nbsp&semi;<&sol;p>&NewLine;<p><strong>Editor&&num;8217&semi;s note&colon;<&sol;strong> Notice how Trump gets things done by talking&comma; taking a negotiating position&comma; establishing that he is the big dog&comma; and watching the other side cave in&period; &nbsp&semi;A man who knows how to wield power gets a lot more done&period; &nbsp&semi;Another example&comma; Trump criticized an act by a Republican Congress to change the ethics rules&period; They backed down immediately&period;<&sol;p>&NewLine;

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