Ford announced on Tuesday that rather than move production of its popular Ford Focus to Mexico, it would instead move production to China, in a decision that likely won’t sit right with US President Donald Trump.
Trump has a long history of claiming to want to put “America first.” During his campaign last year, he memorably bashed Ford after the company announced plans to build a $1.8 billion plant in Mexico to take over production of the Ford Focus from an existing plant in Michigan. Then, Trump congratulated himself when the company began to back down.
Word is that Ford Motor, because of my constant badgering at packed events, is going to cancel their deal to go to Mexico and stay in U.S.
— Donald J. Trump (@realDonaldTrump) October 25, 2015
In January, Ford officially cancelled its Mexico plans and instead decided to keep production in Michigan and in other locations in the US. Afterward, Trump congratulated the company in a series of tweets, thanking them for fostering business at home.
However, apparently Ford had other locations in mind.
Ford said last week that it will expand in Michigan and U.S. instead of building a BILLION dollar plant in Mexico. Thank you Ford & Fiat C!
— Donald J. Trump (@realDonaldTrump) January 9, 2017
Ford’s new China factory will begin operations in Chongqing in 2019 after production at the Michigan factory ends. According to Bloomberg, Joe Hinrichs, Ford’s president of international affairs, thinks that the switch to China is nothing to get excited about.
“Consumers care a lot more about the quality and the value than they do about the sourcing location,” he said. “iPhones are produced in China and people don’t really talk about it.”
Big announcement by Ford today. Major investment to be made in three Michigan plants. Car companies coming back to U.S. JOBS! JOBS! JOBS!
— Donald J. Trump (@realDonaldTrump) March 28, 2017
In recent years, Mexico has always been a popular destination for American companies because of its cheap labor and proximity to the US, but Ford’s decision to choose China instead may have huge implications for the future of car manufacturing in Asia. Especially since they expect to save $1 billion with the move.
Reuters points out that other American car companies are alreadly operating in China. General Motors started exporting Buicks and Cadillacs from the Middle Kingdom last year. Meanwhile, Swedish luxury vehicle manufacturer Volvo is now owned by a Chinese company. Ford, however, outwardly prides itself on its American workforce and domestic business endeavors.
But its move is part of a larger trend in the industry. Until recently, Americans refused to buy Chinese-made cars, believing them to be unreliable. Now Hinrichs comes to China’s defense.
“The quality is very good in our plants there,” he said. “China is capable of producing at the same global level standards we have everywhere else.”
Trump has not yet given his opinion on Ford’s decision, but chances are, he’ll tweet about it soon.
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