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Home News Business News

Despite Trump victory lap, Ford wasn’t planning to move plant to Mexico

by CNN
Friday, November 18, 2016
in Business News
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President-elect Donald Trump took credit Thursday night for stopping Ford from moving jobs from Kentucky to Mexico.

The only problem with the claim? Ford had never said it planned to move its Louisville, Ky, assembly plant to Mexico.

In fact the automaker had already made a commitment to the United Auto Workers union in their legally binding contract a year ago to invest $700 million in the plant and to build the Ford Escape there. On Thursday it said it will also keep production of the Lincoln MKC at the plant as well, though that won’t change employment.

It had planned to shift production of the much smaller volume Lincoln MKC to another plant as Escape production increased. Mexico was a possible location for that luxury model. But even under that plan, it had planned to keep employment near the current 4,700 workers.

That decision to keep the MKC in Kentucky was enough for the president-elect to take a victory lap on his favorite medium of Twitter on Thursday night.

“Just got a call from my friend Bill Ford, Chairman of Ford, who advised me that he will be keeping the Lincoln plant in Kentucky – no Mexico,” he tweeted.

“I worked hard with Bill Ford to keep the Lincoln plant in Kentucky. I owed it to the great State of Kentucky for their confidence in me!”

Ford issued a statement Thursday in which it repeated earlier statements that it has invested $12 billion in U.S. plants and added 28,000 jobs there in the last five years. That represents nearly a 50% increase in U.S. jobs at Ford during that period.

“Today, we confirmed with the President-elect that our small Lincoln utility vehicle made at the Louisville Assembly Plant will stay in Kentucky,” said the statement. “We are encouraged that President-elect Trump and the new Congress will pursue policies that will improve U.S. competitiveness and make it possible to keep production of this vehicle here in the United States.”

Ford had temporarily shut its Louisville plant the weeks of Oct. 17 and Oct. 31.

But that is due to slowing sales and excess inventory, not a plan to move production to Mexico. And most of the 4,700 workers there continued to receive 80% of their normal play during this temporary shutdown.

Ford has announced plans to move small car production to a new plant under construction in Mexico, but the workers who now build those models — the C-Max and Ford Focus — will keep their jobs and be put to work building more profitable and popular vehicles, likely the new Ford Bronco SUV.

Ford did announce plans this week to be the first automaker to import a passenger vehicle from India to the United States when it introduces the EcoSport to the U.S. market in 2018. That compact crossover SUV has always been built at the plant in India, though, and has never been built in the United States.

This is not the first time that Trump has claimed credit for getting Ford to change its mind on Mexico production when in fact Ford was only following the terms of a contract it had reached with the UAW.

A year ago when Ford started building the heavy duty F-Series trucks in Ohio rather than in Mexico, where they had been built, Trump again claimed credit.

“I brought [Ford’s Mexican investment plans] up in so many speeches, and frankly I think I embarrassed ’em,” he told a crowd in New Hampshire in October 2015. “But Ford is now gonna build a massive plant in the United States, and every single person, even my harshest critics gave me credit for it.”

However Ford wasn’t building a new plant, simply shifting production to an existing U.S. plant. And that shift had been agreed to four years earlier in a 2011 labor deal with the UAW.

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CNN

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