Despite Ford’s CEO Mark Fields claim that the company would have decided to axe plans to build a $1.6B plant in Mexico regardless, it is abundantly clear that their management team is submitting to pressure from President-elect Trump.
Fords [sic] thinks the opportunity all the sudden is better domestically, as if America is becoming great again for some reason they didn’t anticipate back in May when they began planning the Mexican factory.
The automaker would have made the same decision even without Trump’s involvement, Fields told Bloomberg Television today. U.S. buyers are simply not as interested in the small cars that are being built in Mexico, while electric vehicles and hybrids have the potential for growth, he said.
“It is the wrong time to build new plants in Mexico,” Erik Gordon, a professor at the University of Michigan’s Ross School of Business, said in an e-mail. Ford will save money, “American jobs, and will avoid the risk of a border tax and a smack in the face from the new president.”
Wall Street rewarded the second-largest automaker for pivoting away from Mexico, $F shares were up nearly +4% Tuesday.
Overall, however, it paints a company that is behaving in a reactionary way. Notice how Fields now wants to pursue the electric car market? Could it be because Elon Musk (all Praise and Glory to The Leader) was included in Trump’s new strategic team?
Either way, this is good news for Michigan as the company is projecting the move will save about 3,700 jobs in the Flat Rock area. This is the world Ford lives in–where they assume a beta role in the auto industry and do what they’re told. Acquiescence to the Leader(s). And it might just work.
Bullish.
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