News that General Motors Co. (NYSE:GMF) plans to invest $1 billion in U.S. plants and add more than 1,000 workers, begs an important question. Is this all the work of Donald Trump and his threats to impose a tariff on cars produced in other countries and imported back into the U.S.
As with many things Trump, the answer depends on who you ask. GM says the plan is part of previously announced investments totaling $5.4 billion over 3 years. Trump tweeted differently.
General Motors is sending Mexican made model of Chevy Cruze to U.S. car dealers-tax free across border. Make in U.S.A.or pay big border tax!— Donald J. Trump (@realDonaldTrump) January 3, 2017
Others Making Similar Moves
GM is only the latest automaker Trump has claimed to have pressured to invest in the U.S. Both Ford Motor Co. (NYSE:FC) and Fiat Chrysler (NYSE: FCAU) made similar moves seen as attempts to placate Trump.
Ford followed GM in announcing it had scrapped plans to build a $1.6 billion automobile plant in Mexico. Meanwhile Fiat Chrysler said it would spend $1 billion in the U.S. Fiat CEO Sergio Marchionne said the decision to invest in the U.S. was previously planned and didn’t result from pressure from the President-elect.
Toyota And Honda Stand By
The presidents of Toyota Motor Corp. Stock not found TOY and Honda Motor Co. (NYSE:HMCC) both indicated there are no immediate plans to stop current production in Mexico. Both companies said they wanted to wait until after Friday’s inauguration to see what the new U.S. president had to say.
Toyota, Honda and Nissan Motor Co. (OTC: NSANY) all have production facilities in the U.S. and Mexico. Toyota and Honda also have plants in Canada. Many of the vehicles produced in Mexico and Canada are shipped to the U.S. making all 3 companies ripe targets for Trump threats.
Tesla In The Driver’s Seat
Then Trump invited Tesla CEO Elon Musk to his Tech Summit meetings and appointed him to his Strategic and Policy forum. Tesla investors responded by causing the company’s stock to soar 17.5% in December.
There’s even talk that Trump might be more friendly about renewables than previously thought. Oh, and Tesla has created more than 13,000 jobs in the U.S. with more to come. Could be a match made in electric car heaven.