The CEO Fields, Marchionne and Bar met with the new Government of the united States in the Roosevelt Room of the White House
The new occupant of the White House is obsessed with the “America First” and old beliefs protectionist. According to his point of view, the united States should focus on its domestic production and not send the money overseas, which has its own logic. However, mr. Trump economic ideology has become a little old-fashioned, something like 200 years.
The world today is globalized, but Trump has his own vision. Believe that if you pick up border trade with its neighbors (especially Mexico), and blackmails the car manufacturers, the ancient industrial facilities of your country will have the splendour that they had before. The idea is good only in his approach, but in your knot longer.
last week Trump was with the great entrepreneurs of the automobile, including Elon Musk (Tesla), but the principal grabbed the triad of national producers: Fiat Chrysler Automobiles, General Motors and Ford Motor Company. The tone was lowered a lot about the disturbing tweets with the then-candidate was threatened by these large companies. He was most cordial, as if wanting to build bridges.
Promise fulfilled, the united States has withdrawn from the signing of the trade agreement in the Pacific, which had not entered into force
Some analysts find that they have made peace
Trump does not want the automotive industry continues to invest on the other side of the border, and also of having threatened to tax heavily the production vehicles foreign, also offers his side more friendly: make it easy for companies that do not have to go outside.
And why has offshored production of the united States? On one side are labor costs, an employee syndicated in the powerful UAW cobra seven times more than a mexican, and enjoy more job benefits, pension, etc., When a country achieves many conquests employment becomes less attractive compared to a country that is not as advanced in that sense.
on the other hand, to make cars lowest price, Mexico comes to mind because the cars are coming and going across the border duty free under NAFTA, the treaty that Trump wants to apear. has Already been cancelled, the signature of the Treaty, the Trans Pacific (TPP), which would have encouraged a lot of trade between Australia, Japan, the USA and several Latin american nations. It was an election promise and fulfilled it. Mark Fields, CEO of Ford, praised that decision, but that the U.S. withdraw from NAFTA sure that it does not make much grace.
Trump can put more facilities to the producers based in the US: you can reduce the taxes, hinder the work of the trade unions, to loosen regulations (such as those issued by the Agency of Protection of the Environment or the EPA), tax incentives of another type, etc, In other words, Trump would have to concede to the industry’s old requests to increase their competitiveness.
Of time, Ford has reculado in the decision to invest $ 1,600 million in another plant in Mexico and has announced an investment of 700 million dollars within u.s. soil. General Motors and FCA have not announced changes in their policies. It does not seem very feasible is that merge new factories in the US, which is not the case since the year 2006. The excess capacity was one of the sins of the Big Three before 2008.
And the new executives do not want to repeat the mistakes of the past, let us remember that both GM and Chrysler (now FCA) took billions of dollars of public money to restructure, and a significant portion of that money has been lost. Prior to founding new factories have to maximize the use of existing plants, and if the Government cooperates, that will be more simple.
In campaign, Donald Trump promised a lot of things, but what is worrying is that the is fulfilling
Donald Trump is not clarified much to manufacturers what will be the policies that you plan to develop to achieve more production on u.s. soil. is Still pending to know what’s going to happen with NAFTA, because as the U.S. withdraws from the agreement is going to do a lot of damage to these manufacturers, and also the american consumer for artificially raising the prices.
The chair can be achieved to avoid more investment in Mexico and that, in the future, you bet more for domestic production. To do this you will need to meet the demands of the industry. If you do not want to skip the law, or put tariffs on any manufacturer or to all, because you can not put a tariff on one particular. U.S. workers may lose out as there is a lot of deregulation, and that is part of the creed of the Republican Party.
The leaders of the Big Three walked away satisfied from this contact with Donald Trump, there is only explaining the new policies, if you are going to abandon NAFTA or not, and what consequences it will have. Possibly there are no more bravado on Twitter by mr. Trump, at least against the automobile industry.
¿What was said by the leaders of the Big Three of Detroit?
“I Appreciate the approach of the President to make the united States a great place to do business. We look forward to working with the President Trump and the members of the Congress to strengthen american manufacturing.” – Sergio Marchionne (FCA)
“we Had a wide-ranging and very constructive debate about how we can work together on policies that provide support to an economy and automotive industry strong and competitive, that supports the environment and security. The united states is our market mother and we are anxious to reach agreements to boost manufacturing in the country. We all want a productive base that is competitive globally and that generates jobs. It is good for our employees, our dealers, our suppliers and our customers.” – Mary Barra (General Motors)
“coming Out of the meeting today, I knew that I was going with a lot of confidence in the president is very, very credible in making the US economy is strong and that you have policies -tax, regulatory or trade – to go in that direction. So that is a meeting very, very positive.” – Mark Fields (Ford)