The war of words between Ford Motor Co. and GOP presidential candidate Donald Trump is heating up, the New York businessman calling it a “disgrace” for Ford to move production of its small cars to Mexico, while the automaker’s CEO is countering that “it’s really unfortunate” that Trump put politics ahead of the facts.
The Republican nominee has been taking shots at Ford for months, ever since it was first revealed that at least some of Ford’s small car production would be moved from a plant in Dearborn, Michigan, to a new operation south of the border. Ford has repeatedly noted that the move was simply going to make room for expanded truck production at a time when SUV, crossover and pickup sales have surged to 60% of the American market at the expense of conventional passenger cars, especially smaller ones.
Trump’s critics have also questioned his decision to focus on Ford while virtually all major automakers, from Japan’s Nissan to Detroit’s General Motors, as well as European marques Mercedes-Benz and Volkswagen, are also expanding their operations in Mexico. They also note that while Trump has promised to penalize Ford if elected president in November, he has made no comments about returning to the U.S. production of his clothing lines now imported from places like Mexico and various parts of Asia.
During a day-long session with industry analysts, Ford CEO Mark Fields confirmed on Wednesday that the maker would shift all of its small car production from the U.S. to other countries by 2018. Ford has, however, been investing heavily to increase American output of its strong-selling light truck models.
Total spending on U.S. plants alone has come to $12 billion since 2011, a period in which 28,000 American jobs have been created. Meanwhile, under the four-year contract Ford negotiated with the United Auto Workers Union last year, it agreed to add or retain 8,500 jobs.
(Trump, Ford tussle over move to Mexico. Click Here for the story.)
That didn’t stop Trump from calling the announcement a “disgrace,” while suggesting that Ford is planning to “fire all of their employees in the United States.”
The comments appear to be targeting potential blue collar voters in swing states like Michigan and Ohio, places that political analysts believe will be critical to Trump’s chances of winning the November vote.
But Ford has joined a chorus of those accusing Trump of bending the facts for his own purposes. “It’s really unfortunate when politics get in the way of the facts. Ford’s investment in the U.S. and commitment to American jobs has never been stronger,” CEO Fields said during an interview with CNN.
While the Republican nominee has been making major changes to his proposed economic strategy, he has repeatedly said he would take steps to penalize Ford for its production plans.
(Ford moving all small car production to Mexico. For more, Click Here.)
“When that car comes back across the border into our country that now comes in free, we’re going to charge them a 35 percent tax,” he said during an appearance on Fox News this week. “And you know what’s going to happen? They’re never going to leave.”
One of the questions is how the next president, whomever is elected, would be able to levy such a penalty. It would, at the least, require action by Congress and could raise legal issues in light of the North American Free Trade Agreement, or NAFTA. Also uncertain is whether Trump would try to single out Ford or any of the other automakers now or soon planning to import cars from Mexico. That country is now one of the world’s largest carmaking nations.
Whether such a move would focus solely on the auto industry or take in other Mexican-made products – such as Trump’s own clothing lines – is also uncertain.
For his part, Ford CEO Fields said there are no plans to rethink the company’s Mexican – or U.S. – production strategy based on the GOP candidate’s speeches.
(Click Here for more about the impact of a Trump or Clinton presidency.)
“There’s lots of hypotheticals,” Fields said. “We have to run our business on what we know today.”