Apr 05

Ford to invest $1.6 billion for new plant in Mexico:

Ford is among at least a half-dozen automakers that have either expanded production or built new plants in Mexico in recent years.

Ford sparked outrage from both the UAW and Republican front-runner Donald Trump on Tuesday, uniting two unlikely foes, after the automaker said it would invest $1.6 billion to build a new plant in Mexico and create 2,800 new jobs there.

The Dearborn automaker has been among Trump’s targets for months because of the widely expected investment. The UAW, which reached a new four-year contract with the automaker last November, also has long been critical automakers who are increasingly building new plants in Mexico.

On Tuesday, both the union and Trump said America’s trade deals lead to job losses.

“These ridiculous, job crushing transactions will not happen when I am President,” Trump said in a statement. “NAFTA has incentivized plants to move to Mexico, closing factories across the United States.  When I am President, we will strongly enforce trade rules against unfair foreign subsidies, and impose countervailing duties to prevent egregious instances of outsourcing.”

Trump has previously said if elected president he would threaten the company and any other automaker who does so with a 35% tariff on any products or parts imported into the U.S. Critics point out the president has no such unilateral power and say such a move, even if authorized by Congress, could touch off a trade war.

Ford has found itself in the cross-hairs of criticism over investing in Mexico even though almost every other global automaker has also announced plans to expand or build new plants in Mexico in recent years.

Ford said construction of the new plant in the state of San Luis Potosí will begin this summer. It expects to begin producing cars there in 2018. Ford’s investment in Mexico will create more than 2,800 jobs by 2020, delivering a blow to the UAW, which pushed for higher wages in its contract talks with the automaker last year.

“Today’s announcement…is a disappointment and very troubling,” UAW President Dennis Williams said in a statement. “For every investment in Mexico it means jobs that could have and should have been available right here in the USA.”

Ford said it remains committed to investing in the U.S. and adding jobs in America even as it expands its presence in Mexico.

“We have to make decisions on a global scale because we compete globally,” Joe Hinrichs, Ford’s vice president and president of the America’s, told the Free Press. “But lets be clear: We are a proud American company and the majority of our investment happens here in the U.S.”

Hinrichs said Ford has hired 25,000 workers in the U.S. in the past five years and produces more cars in America than any other automaker.

He also said the investment in Mexico will not result in a loss of jobs in the U.S. Mexico is Ford’s fourth largest vehicle manufacturing site for global customers – behind the U.S., China and Germany.

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