Tuesday, January 3, 2017
Ford to scrap Mexico plant, invest in Michigan; CEO cites Trump policies
DA ARTICLE
Could Trump's tweeting actually have a positive affect on our country? This article discusses the Ford Motor Company's decision to cancel developing a $1.6 billion plant, instead investing $700 million in a preexisting assembly plant in the great state of Michigan. While most news outlets speculate this decision was made in part by Trump's pressure on the company, CEO Mark Fields denies this.
What are your thoughts?
Do you think it was Trump, economic factors, or both that resulted in Ford's decision?
Is this how Trump will begin his plan of bringing back outsourced jobs to America?
Will Trump's tweet about a "big boarder tax" ever come into fruition?
Will Cheetos strike up an endearment deal with Trump's orange face?
P.S
Yes, I got this from Fox to piss everyone off :)
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I don't think that any major company feels seriously threatened by Trump's tax threats. The company probably decided it was just cheaper to manufacture here because of lower shipping costs. Also, they probably want a publicity boost- an encounter with Trump does that. As we saw with Carrier, there is unlikely to ever be a tax for keeping jobs here (not that that's a good idea), but instead a tax credit for not leaving. At best, symbolic moves like these will prevent many jobs from leaving, not coming back. Trump will also have to consider the cost on the consumer of tariffs and taxes, and is unlikely to get past a GOP Congress on the issue of trade.
ReplyDeleteQuestion two made me laugh, because does Trump really have a "plan" on how to bring outsourced jobs back to America, or is he just saying that? Yes, this seems like it is part of a plan, but I agree with Samir that it might have just been for publicity, or cheaper shipping, or something along those lines. Maybe large businesses that doesn't support Trump could be a little worried about his tax threats, but then again, everyone who doesn't support Trump is worried in some way about something he's said.
ReplyDeleteI don't know how successful Trump will be at getting jobs to return, especially with what his big ideas for how America will change, but maybe, he (really Pence) will figure out some sort of actual restriction to keep jobs from leaving.
Any major company shouldn't feel that threatened by Trump, as proposals including taxes and tariffs will not warrant support within the GOP. They simply don't make sense when it comes down to making a profit, and other countries will do the same to us if we end up placing these into effect. Instead, I see something along Samir's ideas being passed, with tax rewards going to companies that stay nationally.
ReplyDeleteI'm sure that Trump will find some way to say that Ford's actions are part of his grand plan or something, but I seriously doubt how much of a plan he really has. If there is a plan, it's more likely to conform to the Republican Party's standards than Trump's.
I'll say both although I think the people at Ford are a bunch or big boys who know how to put on their big boy pants and make their own decisions based on the economy. I think it's cute that anyone thinks Trump has a plan about how to bring jobs back to the US... or a plan about anything else. It's possible that his border tax will actually become reality, but possible in the same way that it's possible that Trump will win a beauty pageant. It could happen depending on how long congress truly works with him and agrees with him, but I really don't think it's all that likely or that if it's imposed that companies will care.
ReplyDeleteAs for the Cheetos, I like to think that Frito-Lay has more pride than that.
I also agree with Samir, none of them feel threatened. A company won't do something unless it will lead to higher profits. I doubt Congressional Republicans would even consider the exit tax because it goes against their principles of free trade.
ReplyDeleteUnfortunately, I don't think the majority of the manufacturing jobs that have been outsourced are coming back. It is simply not economical for companies in these industries to stay in the U.S. due to the presence of much cheaper labor and virtually no regulations in developing countries. If they do come back, they will likely be automated. It is terrible that working class Americans who have made a good living in these jobs now have to work for much less, but I believe the only real solutions are government-supported training programs for up-and-coming fields and large scale infrastructure projects. We cannot start implementing tariffs and starting trade wars with the entire planet. It will only cripple our overall economy.
I agree with what Josh said. I’d also like to bring up something I heard on NPR. They were saying that all of what Trump is doing is only hurting small, fragile economies like Mexico, not the big ones like China. While it is good that some Americas are getting their jobs back, this is just drop in the bucket. Unless serious change occurs by creating strong manufacturing jobs here (and I don’t think it can because that isn’t how free-market capitalism works) we will need to focus on infrastructure and energy jobs at home. Major companies are not afraid of tariffs and those will likely have no effect on bringing jobs back to the US.
ReplyDeleteI think economic factors are the reason any company would come back or leave the US. If they can save money by investing more in the US, or if they can help their own public perception, any company would be smart to do that. I don't think Donald Trump tweeting really has an effect on any of this, as if all comes down to money and which way is more financially stable. This would explain why many companies still do outsource their jobs, despite Donald's best efforts.
ReplyDeleteI agree with Samir and Josh - a major company would not feel threatened or influenced by a certain tweet or policy of Trump. That being said, part of Ford's advertising model heavily involves a sense of patriotism, being a mainly American company. Ford perhaps will seek to improve its public image by milking that "made here, in AMERICA" factor to their production strategy. The president also has an incredible amount of influence on public image (sadly), but this could benefit Ford if Trump commends them for their investment in his American manufacturing policy. While I do believe that many of Trump's policies would be detrimental to American society, some of his ideas for manufacturing and infrastructure could help the economy.
ReplyDeleteMan I love how Trump exclaims every job that get brought back to America is all by his doing and his doing alone. Like come on, you aren't even sworn in yet. It was even said in the article that the plant in Michigan was already decided on being built by Ford all the way from last February. This leads me to believe this is all a publicity stunt on Ford's part. You can expect for the next 4 years commercials about how Ford is an AMERICAN company that cares about AMERICANS. But that is simply not true. Ford is a company, and the sole purpose of a company is to drive profits. Locating their plants in Michigan was simply the cheapest option, Trumps tweet tirades had nothing to do with it.
ReplyDeleteI do not think Trump had any real influence over this move, rather economic factors made it possible for Ford to remain in the U.S. As Matt said, I think it may even be a publicity stunt, trying to make their company appeal to the same nationalists that elected Trump in the first place. As Samir said, I do not think most companies will feel threatened by Trump's tariff threats, since they know, like we should, that if they came into policy, it would be horrible for the economy. Some companies may strike deals to remain in the US for publicity with the incoming President, but I do not think he has any ability to bring jobs back to the US without serious consequences. And since Cheetos has its plants in the US, I think Trump may look favorably on them and will look into an endorsement deal.
ReplyDeleteI don't think Trump had much to do with this decision. I think Ford simply weighed the benefits and costs of both options and decided on this one. It was probably more economically sound and also fit with their image more, so it would only make sense that they set up a factory here. I don't know if Trump actually thinks it was his doing, but I wouldn't be surprised if he was an added bonus to Ford. They probably expected Donald to shoot out a tweet commending them, giving them a but more publicity. I don't think they needed it, but it wouldn't hurt. I don't think Trump knows how to bring jobs back to America. He probably wasn't the cause of this and I think he knows it. I don't really think he knows what he's doing, he has just made a lot of empty promises and I don't think he'll deliver.
ReplyDeleteFirst of all Cheetos will probably sue Trump for using their trademarked orange powder without giving them credit. In terms of Ford's choice of building in Michigan, I don't think that Trump had anything to do with it. Ford is a company that advertises heavily on its Americanness, and this seems like a publicity stunt on part of Ford. "Hey look at me I'm in America! Buy my cars!"-Ford probably. Ford is doing this because it's what they think will give them the most profit. Donald Trump had little to no influence in that decision.
ReplyDeleteHe hasn't done anything yet and Ford can't be sure that some kind of pro-business legislation will actually be passed, so Ford was acting on their own. The border tax sounds like a good time. However, maybe we should keep our neighbors to the north and the south on our good side and not tax them to death. What he is doing already appears to be bringing jobs back, but just tweeting about it is barely scratching the surface and he's got far more work ahead of him.
ReplyDeleteI think it was both Trump and the economic factors that led to Ford's decision. If Ford were to follow through with the outsourcing, they would have gotten angry tweets from Trump and lose public face. For example Toyota stock dropped right after Trump angrily tweeted about them for their Mexico plant. And Toyota isn't even an American company! Ford, being a very "American" company definitely wanted good public opinion on them. Perhaps they made the decision without mentioning Trump, but the thought of him was certainly in their minds subconsciously.
ReplyDeleteI think that Ford's final decision wasn't influenced solely by Trump, but his tweets and publicity could have been an afterthought to their decision. A company's sole purpose is to maximize their profits while producing as inexpensively as possible. Ford was just weighing the pros and cons economically, and deciding what was best for their company and for plans in the future. However, this makes for great publicity for Trump and his plan to bring jobs back to the U.S., regardless if Ford had even thought about their relationship with Trump.
ReplyDeleteVery little of what Trump tweets has any substance to it. Unfortunately, however, he is able to create a general "narrative" in the way he addresses issues, and this could have an economic affect that I have no doubt companies like Ford at least take into account. As others like Eric and Josh talked about, companies like Ford don't want to be perceived as anti-American. However, they are companies, and they'll ultimately do whatever will allow them to be as cost-efficient as possible
ReplyDeleteI doubt Trump had much influence over this decision, just as much as I doubt that Trump has many plans to follow through with the numerous claims he tosses onto twitter willy-nilly. Ford, and other companies, probably have little in mind about Trump when making their decisions until it starts breaking laws. For now, Trump is an after thought to companies, prioritized after economic pursuits.
ReplyDeleteI agree with what most people have said: a major company such as Ford has no real reason to be influenced by the president. As Jay said, Ford makes a lot of the advertising about how they are America's car company, so by keeping jobs here, they remain a made-in-America company, improving their publicity and their popularity. In addition to this, as we have discussed many times, Trump's tweets are mostly just ramblings about nonsense and they often contradict themselves, so I doubt Ford felt any sort of threat from the tweets about anything. Ford must have done the math and figured out that regardless of any potential tax that may be imposed, keeping the jobs here was the most financially beneficial solution, as they would never be influenced by Trump's random tweets.
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