President-elect Donald Trump campaigned on saving American jobs and, since the election, has targeted automakers on Twitter, urging them to keep production domestic or face steep border taxes. But there’s one force he cannot shame into compliance: the market.
Although Trump has repeatedly blasted trade as an employment killer, factors beyond legislative control can chip away at manufacturing jobs, including technology and consumer buying habits.
This week, for example, General Motors announced a plan to expand its U.S. industrial footprint — while preparing to lay off about 2,000 workers over the next month at auto plants in the Midwest.
The company's reason for this seemingly contradictory move: It has confidence in the American manufacturing climate, chief executive Mary Barra said in a statement Tuesday. But demand for small cars has fallen as buyers increasingly favor SUVs. So, GM will soon slash some compact production jobs in Ohio and Michigan.
Trump took credit for part of the automaker’s strategy on Twitter early Wednesday, slamming an NBC News report that suggested his involvement in GM's and other companies' job creation wasn’t as significant as the president-elect claimed. (The Washington Post has reported similar findings.)
“Totally biased @NBCNews went out of its way to say that the big announcement from Ford, G.M., Lockheed & others that jobs are coming back to the U.S.,” Trump said, “but had nothing to do with TRUMP, is more FAKE NEWS. Ask top CEO's of those companies for real facts. Came back because of me!”
Ford chief executive Mark Fields, however, said the company’s plan to cancel a $1.6 billion factory slated for San Luis Potosi, Mexico, and instead invest in Michigan employment had nothing to do with Trump (though he said he looks forward to working with the administration).
“The reason that we are not building the new plant,” Fields said earlier this month, “the primary reason, is just demand has gone down for small cars.”
Ford will instead focus on self-driving and electric vehicles — high-tech models that are better created near its engineering staff in Dearborn, Mich.
GM, meanwhile, didn’t mention Trump on Tuesday when it unveiled plans to pour $1 billion into U.S. manufacturing, creating a flurry of new jobs. The company said the plans had been long underway.
“As the U.S. manufacturing base increases its competitiveness, we are able to further increase our investment, resulting in more jobs for America,” Barra, an economic adviser to Trump, said in a statement Tuesday. “The U.S. is our home market and we are committed to growth that is good for our employees, dealers and suppliers.”
GM said its investment would fund new vehicle and technology projects but provided no specifics. These endeavors, according to the statement, would produce “1,500 new and retained jobs” within GM over the next three years. (The company would not say what kind of jobs.)
The automaker, however, will slash the third production shift in Lordstown, Ohio, which assembles the Chevrolet Cruze. It’s also cutting about 800 jobs at a Lansing, Mich., factory, where workers make the Chevy Camaro and Cadillac models.
‘Nothing is happening to save us’
Hours after GM unveiled its U.S. expansion strategy Tuesday, Marquis Brown started one of his last shifts at the automaker’s factory in Lordstown. Come Friday, he and about 1,200 of his co-workers will lose their jobs.
“It’s kind of a slap in the face,” said Brown, speaking through a headset as he built roofs for Chevrolet Cruzes. “Nothing is happening to save us.”
Brown, 30, said that he understands GM’s reason for the cutback. But he took issue with the automaker’s decision to promote its commitment to U.S. workers this week while preparing to cut his job.
Robert Morales, president of the UAW Local 1714, which represents some of the Lordstown employees, said the market triggered the job loss. Chevy Cruze sales have plummeted from 248,224 in 2013 to 188,876 last year, according to Kelley Blue Book data.
“Truly, it’s a shift of buying,” Morales said. “The market has shifted to SUVs and trucks.”
Mark Muro, who studies manufacturing trends at the Brookings Institution, a Washington think tank, said neither the White House nor policy can save certain auto industry or manufacturing jobs. Labor-reducing devices wiped out most positions lost over the past two decades, research shows. And sometimes, buying habits change, resulting in a factory cutting a shift.
“Trump’s tweets are getting too narrow and over-focused on trade effects,” Muro said. “Gas prices, where the company is going technologically and what people are buying also play a role.”
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