Posted on 01/04/2017 3:53:27 AM PST by expat_panama
Trade: Ford's decision to build a factory in the U.S. instead of Mexico, saving 700 jobs, is a good thing. But is it because Ford fears what Donald Trump might do to it, or because it thinks the corporate environment will be so much better under Trump than under Obama? And, yes, the answer really matters.
Ford's move to invest $700 million in Michigan, creating about 700 new jobs here has created quite a political stir. The new plant, slated for Flat Rock, Mich., will make cutting-edge electric and self-driving cars, which Ford has said will likely outsell traditional cars by 2032.
That wasn't all. Last year, Ford announced a $1.6 billion investment in Mexico... ...expanding its electric-car plant in Michigan.
"We didn't cut a deal with Trump," Ford CEO Mark Fields told CNN...
...That makes it even more important that Trump keep his promise about cutting regulations and reducing taxes...
...hate to think the only reason companies like Ford would want to invest in the U.S. is because of threats of tariffs of as much as 35% on what they make overseas and sell here. Or out of fear they'll be singled out in one of the president-elect's famously acidic tweets.
The lure of protectionism in the form of higher tariffs is strong, but ultimately it's a tax that all of us pay. And in the long run, no matter what you might hear otherwise, protectionism destroys jobs, it doesn't create them. Far better for all of us if Donald Trump focuses on creating long-lasting prosperity by making the U.S. once again the world's most-competitive economy, rather than threatening companies with taxes and shaming them for doing what bad government policies encourage them to do.
(Excerpt) Read more at investors.com ...
My BS meter just exploded.
IT’S NOT TRUMP! IT’S NOT IT’S NOT IT’S NOT! WAAAAAAAH! MOMMY! /lsm
IT’S NOT TRUMP! IT’S NOT IT’S NOT IT’S NOT! WAAAAAAAH! MOMMY! /lsm
I hope Trump pulls the government watchdogs on GM...if their still there
I will never buy another GM product in my life, Period.
I have two great Fords and the next one will be Ford.
So if I want to buy an American small car, should I choose the Ford Focus, or the made in Alabama Hyundai Elantra?
“Is Ford’s Move A Cave-In To Trump Protectionist Talk, Or A Savvy Bet On Future?”
Yes.
One in the same, I’d say.
WOW --stock indexes jumping, gold/silver soaring --we got something here for the whole family!
Good morning (too); really tho our stock jump yesterday was not quite a % and while volume was up a lot it was still only back up to 'average' after the low-volume holidays. Metals however are showing a lot of robust action w/ gold, silver now at $1,167.10, $16.49. Add to that metals futures this AM are +1.08% along w/ stock index futures at +0.18%.
Seems the bean counters are back from vacation:
7:00 AM MBA Mortgage Applications Index
10:30 AM Crude Inventories
2:00 PM Auto Sales
2:00 PM FOMC Minutes
2:00 PM Truck Sales
2:00 PM FOMC Minutes
--and:
Here Are My Top Ten 'Surprises' For 2017 - Byron Wien, Blackstone Group
The Smart Set Shuns Oil, Wall Street, Smaller Gov't - John Batchelor, TDB
Actually, Active Investment Mgt. Never Went Away - Barry Ritholtz, BBW
Is the Stock Market Presently Overpriced? - William Droms, MarketWatch
If Italy Exits EU, the Fallout Is Going to Be Awful - Steve Forbes, Forbes
How to Defund Wasteful Institutions - Richard Rahn, Washington Times
With Trump, Economic Feast with Surprises - Andrew Ross Sorkin, NYT
Is Trump's Tariff Plan Constitutional? - Rebecca Kysar, New York Times
With Ford, Trump Adopts a Miniature Jobs Policy - Ed Kilgore, New York
Except Ford Isn't Adding U.S. Jobs Because of Trump - Daniel Gross, Slate
Yes.
A bit of both.
It’s NOT protectionism when the foreign markets are so protectionist as to put our products in the toilet. It’s called sanity when you save American jobs and markets. Once foreign nations modify their behavior to allow free markets, we can reciprocate.
The media including Fox are presenting the Ford and other industry acts as adversarial, as forced, grudging, change. That is not reality.
They all met one on one with PE Trump. What transpired for sure we do not know, but I suspect the PE listened rather than dictated. He got a short version of their companies problems.
Then he told them he was going to implement change very favorable to their businesses. Rather than an adversary, he was their ally. They did in fact sit at the table and make a deal. The new President will make sweeping changes that will improve business and profitability. The CEO’s will endeavor to keep production at home and create new jobs.
I think you got that right. Business leaders can sit down with DJT and feel comfortable making a deal. Way different than any politician in our lifetimes. Maybe different than any President ever.
The next thing is dealing with the unions, who can make or break this effort. Work rules are a big, big deal. A new plant with a lot of automation, and flexible work rules will be very productive. If the unions try to kill productivity it will not work out long-term. Michigan is now right-to-work, and I think that was a big factor in this. That and the promise of a better NLRB.
That's my take too, but somehow the news biz likes to pander to the folks (like we got here) who're stuck on confrontation. Yeah, I like confrontation as much as the next guy but it's just not how we create wealth. So for the article's question of push vs. partner the consensus here is--
Redleg Duke A bit of both. abb Yes. mad_as_he$$ Yes.
--and what I see is that Ford's got dozens of factories all over, w/ new ones on the way, and Trump's an adult who knows that a foreigner working does not mean some American can't.
Trump probably told them that he would cancel obama idiotic mileage requirement if they considered moving back to the USA.
My take is that we do not want Ford to be 'moving back' because this movement we got is that Ford is growing and "moving back" means it would have to be shrinking. I was just looking at Ford's map of overseas factories and noticed that it's even got two plants several hundred miles east of Moscow!
Ford's big, and we want it to be big and it means we got lots of Americans overseeing ops everywhere.
Short-term, of course it is a cave-in. We’ll have to see if their long-term plans change, but US executives (and RINO politicians) are notoriously “next quarter oriented” these days, and nobody wants to stand in front of the Trump train - except the few hapless jerks who in defiance of all logic and reason keep daring to appear on Tucker Carlson’s show. :)
The Mexican plant was to build small, more fuel-efficient cars. Cars with lower profit margins and where labor costs are more important. Demand for those cars is down, so the Ford production capacity in Mexico is sufficient to meet projected demands. Instead Ford will invest in higher margin vehicles which, coincidentally, are made in the U.S. And they’re willing to give Trump partial credit for their decision. Win-win for everyone.
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