U.S. flags flutter in the wind in front of the General Motors Corp headquarters in Detroit, Michigan. REUTERS/Rebecca Cook Reuters
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GM to Invest $1B and Create 1,000 Jobs
But GM sources stressed that the new investment by the automaker was not driven by the incoming president’s threats — a position echoed by GM General Counsel Craig Glidden in a story by the Wall Street Journal.
Decision Likely Dates Back to 2014
Investment decisions of this magnitude and involving changes to manufacturing operations are typically the result of several years of study and require months of consideration by a company’s board of directors, noted David Cole, director-emeritus of the Center for Automotive Research, in Ann Arbor, Michigan, in a discussion this week. That would suggest that the latest GM investment project began as far back as 2014.
And it is just one in a string of investments announced by the automaker since emerging from bankruptcy in 2010. Overall, those have resulted in the addition or retention of of 25,000 American jobs, including 6,000 in the manufacturing sector.
That includes workers at the maker’s assembly plant in Orion Township, Michigan, where it produces the Chevy Sonic, a small car previously imported from South Korea. But due to shifting market demands, small car sales have tumbled and production has been cut at the suburban Detroit facility. GM hopes to boost operations there since adding production of the new Chevrolet Bolt EV on the same assembly line.
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The issue of auto industry investments in the U.S. became politicized with Donald Trump’s entry into the 2016 political campaign. He quickly took aim at Ford for importing vehicles from Mexico, amping up his criticism last April when the nation’s second-largest automaker revealed plans to move all of its small car production to a new factory south of the border.
Early this month, Ford CEO Mark Fields announced the automaker was scrubbing the $1.6 billion plant, triggering self-congratulatory tweeting by Trump, even though Ford officials publicly noted they were still planning to move small car production to Mexico. They just decided to save cash by merging it into an existing, underutilized Mexican plant.
The president-elect also offered praise for Fiat Chrysler when it announced new U.S. investments in several Midwest factories — despite the fact that it had previously revealed the outline for that move, which shifts production at two plants from slow-selling passenger cars to high-demand light trucks.
GM’s CEO Is One of Trump’s Advisers
Trump’s attack on GM came as something of a surprise considering he had previously appointed the maker’s Chairman and CEO Mary Barra to his new economic advisory council. But he issued a tweet on January 3 warning, “Make in U.S.A. or pay big border tax,” a reference to the Chevy Cruze. In fact, only a few thousand of those hatchbacks are imported from Mexico. The bulk of the Cruze volume — all of the compact sedan versions — are produced in the U.S.
Nonetheless, following news of the FCA and Ford moves, Trump declared at his news conference last week, “General Motors will be following, and I think they will be.”
For her part, Barra told reporters at the North American International Auto Show last week that GM will not alter its manufacturing plans to please the new president. It will continue to make investments that reflect its overall global strategy. That will include projects in the U.S. and abroad, including possible future efforts in Mexico.
