Jan 03

Trump Takes Victory Lap After Ford Cancels $1.6 Billion Mexican Expansion Plan As “Vote Of Confidence” In President-Elect:

Update: sure enough, here comes Trump’s twitter victory lap:

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Trump’s recent “strong hints” to US-based automakers to keep production within the US are starting be heard loud and clear, and nowhere more so than at Ford, which just hours after observing the beat down Trump gave to competitor GM on Twitter, announced that it is scrapping plans for a new $1.6 billion plant in San Luis Potosi, Mexico after itself coming under criticism by Donald Trump for shifting small-car production south of the border, and announced it would instead invest $700m in a plant expansion in Flat Rock, Michigan.

Mark Fields, Ford’s chief executive officer, announced the plan today at a press conference at the automaker’s factory in Flat Rock, Michigan, south of Detroit. The second largest U.S. automaker builds the Mustang sports car and Lincoln Continental sedan from its Flat Rock plant, which employs more than 3,700 workers according to Bloomberg. Ford idled the factory for a week in October due to declining Mustang sales, which fell 13 percent in the first 11 months of 2016.

The automaker’s CEO Mark Fields told CNN that the move is a “vote of confidence” in President-elect Donald Trump’s pledge to create a pro-business environment. Fields emphasized, however, that he did not negotiate any special deal with Trump.

“We didn’t cut a deal with Trump,” he said. “We did it for our business.”

Perhaps, but as Reuters notes, Ford wasted no time to notify Trump of its decision this morning, perhaps before it even went public with the announcement:

Trump had previously slammed Ford on the campaign trail over the automaker’s plan to invest $1.6 billion in Mexico by shifting its North American small-car production south of the border. Ford had emphasized that the move would not affect U.S. jobs because the automaker would be putting new vehicles into the Michigan plants.

But now Ford will instead build the Ford Focus at an existing plant in Mexico and invest $700 million in its plant in Flat Rock, Mich. in an effort to produce more electric and self-driving cars. The automaker has said it plans to build a fully self-driving car by 2021.

“I am thrilled that we have been able to secure additional UAW-Ford jobs for American workers,” said Jimmy Settles, United Auto Workers vice president, according to CNN.

And so, it would appear that Trump was right, and won, again.

Curiously, according to CNBC, a high level Ford source said that “Trump had nothing to do with Ford’s decision to expand its Michigan plant.”

Sure, it was just a bigly coincidence.

We look forward to his victory lap on Twitter in moments.

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From the press release:

FORD ADDING ELECTRIFIED F-150, MUSTANG, TRANSIT BY 2020 IN MAJOR EV PUSH; EXPANDED U.S. PLANT TO ADD 700 JOBS TO MAKE EVS, AUTONOMOUS CARS

Ford today detailed seven of the 13 new global electrified vehicles it plans to introduce in the next five years, including hybrid versions of the iconic F-150 pickup and Mustang in the U.S., a plug-in hybrid Transit Custom van in Europe and a fully electric SUV with an expected range of at least 300 miles for customers globally.

The automaker also announced plans to invest $700 million to expand its Flat Rock Assembly Plant in Michigan into a factory that will build high-tech autonomous and electric vehicles along with the Mustang and Lincoln Continental. The expansion will create 700 direct new jobs.

The moves are part of a $4.5 billion investment in electrified vehicles by 2020, offering customers greater fuel efficiency, capability and power across Ford’s global vehicle lineup. The plans are part of the company’s expansion to be an auto and a mobility company, including leading in electrified and autonomous vehicles and providing new mobility solutions.

“As more and more consumers around the world become interested in electrified vehicles, Ford is committed to being a leader in providing consumers with a broad range of electrified vehicles, services and solutions that make people’s lives better,” said Mark Fields, Ford president and CEO. “Our investments and expanding lineup reflect our view that global offerings of electrified vehicles will exceed gasoline-powered vehicles within the next 15 years.”

Ford is focusing its EV plan on its areas of strength – electrifying its most popular, high-volume commercial vehicles, trucks, SUVs and performance vehicles to make them even more capable, productive and fun to drive.

The seven global electrified vehicles announced today include:

  • An all-new fully electric small SUV, coming by 2020, engineered to deliver an estimated range of at least 300 miles, to be built at the Flat Rock plant and sold in North America, Europe and Asia
  • A high-volume autonomous vehicle designed for commercial ride hailing or ride sharing, starting in North America. The hybrid vehicle will debut in 2021 and will be built at the Flat Rock plant
  • A hybrid version of the best-selling F-150 pickup available by 2020 and sold in North America and the Middle East. The F-150 Hybrid, built at Ford’s Dearborn Truck Plant, will offer powerful towing and payload capacity and operate as a mobile generator
  • A hybrid version of the iconic Mustang that will deliver V8 power and even more low-end torque. The Mustang Hybrid, built at the Flat Rock Plant, debuts in 2020 and will be available in the North America to start
  • A Transit Custom plug-in hybrid available in 2019 in Europe engineered to help reduce operating costs in even the most congested streets
  • Two new, pursuit-rated hybrid police vehicles. One of the two new hybrid police vehicles will be built in Chicago, and both will be upfitted with their police gear at Ford’s dedicated police vehicle modification center in Chicago
  • In addition, Ford announces that its global utility lineup will be the company’s first hybrids powered by EcoBoost® rather than naturally aspirated engines, furthering improving performance and fuel economy.

The company also plans to be as aggressive in developing global electrified vehicles services and solutions. These include EV fleet management, route planning and telematics solutions.

Building the Future

To support the new era of vehicles, Ford is adding 700 direct new U.S. jobs and investing $700 million during the next four years, creating the new Manufacturing Innovation Center at its Flat Rock Assembly Plant. Employees there will build the all-new small utility vehicle with extended battery range as well as the fully autonomous vehicle for ride-hailing or ride-sharing – along with the iconic Mustang and Lincoln Continental.

“I am thrilled that we have been able to secure additional UAW-Ford jobs for American workers,” said Jimmy Settles, UAW vice president, National Ford Department. “The men and women of Flat Rock Assembly have shown a great commitment to manufacturing quality products, and we look forward to their continued success with a new generation of high-tech vehicles.”

This incremental investment in Flat Rock Assembly Plant comes from $1.6 billion the company previously had planned to invest in a new plant in Mexico.

Ford today announced it is cancelling plans for the new plant in San Luis Potosi, Mexico. It also announced that, to improve company profitability and ensure the financial as well as commercial success of this vehicle, the next-generation Focus will be built at an existing plant in Hermosillo, Mexico. This will make way for two new iconic products at Michigan Assembly Plant in Wayne, Michigan, where Focus is manufactured today – safeguarding approximately 3,500 U.S. jobs.

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The Mexican peso is understandably unhappy following the news:

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