Ford moving all production of small cars from US to Mexico – USA TODAY
Ford announcements today range from shifting much of their North American production to Mexico and their enthusiasm for self-driving cars in the future.
DETROIT — Ford Motor announced Wednesday that it shifting all of its U.S. small car production to Mexico, a development that immediately played into presidential election politics since it touches on a signature issue for Republican nominee Donald Trump.
Ford’s declaration came as CEO Mark Fields sought to appeal to investors.
“Over the next two to three years, we will have migrated all of our small car production to Mexico and out of the United States,” CEO Mark Fields told a meeting in Dearborn, Mich., where it is based.
But the new development played perfectly for Trump, who was campaigning in the Michigan, the traditional home to the nation’s auto industry. As recently as April, he blasted Ford’s plans to move production to Mexico as an “absolute disgrace.” And on Wednesday, he picked up the beat again as he visited Flint, which has been hard hit by the loss of auto worker jobs.
“We shouldn’t allow it to happen. They’ll make their cars, they’ll employ thousands of people, not from this country and they’ll sell their car across the border,” Trump said. “When we send our jobs out of Michigan, we’re also sending our tax base.”
In Michigan, Ford’s announcement didn’t come as a great surprise. Ford has said it continues to invest heavily in its U.S. plants and isn’t cutting jobs here. Last fall, the automaker made a commitment to invest $9 billion in U.S. plants, with about half going to 11 facilities in Michigan. The deal created or retained more than 8,500 jobs as part of a new four-year contract with the United Auto Workers union, a net increase in the U.S.
Still, UAW President Dennis Williams has repeatedly blasted Ford and other automakers for investing so much money in Mexico.
There is no reason, mathematically, to go ahead and run to countries like Mexico, Thailand and Taiwan,” Williams said earlier this year. “We all recognize there is a huge problem in Mexico. So we have to address it as a nation. The UAW cannot do it alone. We are not naive.”
With average auto worker wages set at fraction of their U.S. counterparts, Mexico allows automakers to reduce their costs enough that they can still make a profit on smaller cars sold in the U.S.
Ford isn’t alone. Fiat Chrysler Automobiles said earlier this year it will end production of all cars in the U.S. by the end of this year as it discontinues production of the Dodge Dart in Belvidere, Ill. and the Chrysler 200 in Sterling Heights, Michigan.
In recent years, automakers that include General Motors, Honda, Hyundai, Nissan, Mazda, Toyota and Volkswagen have all announced plans to either expand existing plants or build new ones in Mexico. Fiat Chrysler Automobiles also has said it is considering an expansion of its production there.
Mexico has seen a 40% increase in auto jobs since 2008 to 675,000 last year while the U.S. saw only a 15% increase in the same period to more than 900,000, according to the Center for Automotive Research in Ann Arbor.
Low gas prices have Americans prefering larger vehicles, especially pickup trucks and higher-riding SUVs and crossover vehicles for their personal use. And those vehicles carry much higher profit margins than for small vehicles.
Contributing: David Jackson, USA TODAY