First it was United Technologies Corp. (NYSE:UTXC) owner of Carrier that threatened to move operations to Mexico. President-elect Donald J. Trump intervened and $7 million later about 800 jobs will stay while roughly 1,250 will leave.
The Boeing Co. (NYSE:BAC) Tuesday became the latest company to be singled out by President-elect Donald Trump, who suggested the aircraft manufacturer was trying to rip off taxpayers in the planned construction of jets to replace the existing Air Force One fleet.
Trump said, “I think Boeing is doing a little bit of a number.’’ He added, “We want Boeing to make a lot of money but not that much money.” Then Trump tweeted, “Cancel order!”
It’s unclear whether the development costs for the next generation of Air Force One aircraft, which can refuel in midair and operate as a mobile command center, are exorbitant. Trump cited a cost of more than $4 billion without providing details or sources.
So far Boeing has deals to come up with development plans for which the U.S. Air Force set aside $1.65 billion. The U.S. Government Accountability Office estimated the cost at $3.2 billion, including $2 billion for R&D.
The Larger Plan
According to Senior Trump transition officials a meeting has been scheduled next week with Silicon Valley executives to address a number of issues. Trump has previously suggested a boycott against Apple Inc. (NASDAQ:AAPLC) following reports the company had refused to decrypt the phone used in a 2015 terrorist attack.
Business Leaders React
Reaction from business leaders has been mixed. Some have praised the president-elect for his announced tax reform measures and infrastructure investment. Generally speaking these are plans most executives believe will help the economy grow.
Some of Trumps plans including proposed tariffs on imports from China and Mexico have raised concerns about retribution and trade wars. Threats to enact a 35% or more tariff on products of U.S. companies made overseas and shipped back to local shores for reselling, have given birth to charges of economic targeting by Trump.
Congress Weighs In
Trump’s ability to take action against foreign trade partners and U.S. companies may lie largely with the willingness of Congress to endorse his plans. So far, House Republican leaders Monday said they would not support Trump’s planned tariffs on U.S. companies that move job overseas.
Among the objectors, House Speaker Paul Ryan said an overhaul of the corporate tax code would be more effective in keeping companies in the United States than tax penalties.
With the millions of followers of Trump’s Tweets, however, his rhetoric has found favor. The question will be whether he can deliver on the promises he has made so far.