Ford Mexico Plant Cancellation Not Quite What It Seems

Small-car production is still heading south
By Rob Quinn,  Newser Staff
Posted Jan 4, 2017 4:11 AM CST
Updated Jan 4, 2017 6:30 AM CST
Flat Rock Assembly employees clap as Ford President and CEO Mark Fields addresses the auto plant on Tuesday in Flat Rock, Mich.   (AP Photo/Carlos Osorio)
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(Newser) – Ford may have found a successful strategy for dealing with Donald Trump: letting him take credit for stuff it was going to do anyway. The company's announcement Tuesday that it's canceling a $1.6 billion plant in Mexico was seen as a big victory for the president-elect, but a closer look at the company's plans suggests Trump didn't change anything, NBC News reports. Ford is still shifting small-car production to Mexico, now to an existing plant in Hermosillo, and the $700 million investment in a Flat Rock, Mich., plant announced Tuesday appears to have already been in the pipeline, with the plant building two models that were not expected to be built in Mexico.

Ford CEO Mark Fields described the move as a "vote of confidence" in Trump's policies, though he said the same move would have been made if Trump hadn't been elected, Reuters reports. Joe Hinrichs, Ford's president of the Americas, tells NBC that falling demand for smaller cars was the main reason for the shift. He says revised sales figures no longer justified building a new plant in Mexico, and that meant money was available to invest in the Michigan plant. The Detroit News reports that Ford is working with Michigan officials to receive possible tax breaks for the Michigan investment. The move is expected to create around 700 new jobs at the plant, most of them starting in 2020. Around 200 jobs will be added in Hermosillo. (In November, Trump took credit for keeping a Ford plant in Kentucky.)

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