Fiat Chrysler To Invest $1 Billion In The US, Add 2,000 Jobs
Automakers are girding for rounds of questions about Mexican investments and U.S. jobs in the wake of Trump's harsh criticism of automakers.
Most of the major automakers in the U.S. have substantial vehicle making operations in Mexico, as well as complex networks of parts makers that supply their factories in the U.S. and support jobs and investment in states such as Ohio and Michigan.
Reuters adds that Fiat's investment decision was not related to Trump's recent attacks Ford,General Motors and Toyota for building cars for the U.S. market in Mexico, as the company had already signaled plans to expand truck and SUV production at its U.S. plants, and discontinued production of small and medium-sized cars in two U.S. factories.
And while it is likely that Fiat execs did not discuss the company's plans with the president elect ahead of time, according the Reuters source Fiat CEO Marchionne wanted to get out the news about adding jobs and investment in the United States in case FCA encounters more criticism from Trump.
And that's how Trump's Twitter "bully pulpit", politically incorrect as it may be, gets the job done: in Reuters' words, "since Trump's election, automakers and other companies have played up their investments in the United States." It's almost amazing how a few well-timed threats can get companies to reevaluate their capex hurdle rates...
It's not just the Italian who are eager to placate the president elect.
According to Reuters, Hinrich Woebcken, CEO of the North America Region for the scandal-ridden German automaker Volkswagen AG, the automaker plans to invest $7 billion in the United States between 2015 and 2019 and will start building its new Atlas SUV in Tennessee later this year. Volkswagen has had a plant in Mexico for 50 years and it is not shifting any jobs to Mexico from the United States. "We do not make our investment decisions based on administrative cycles. Our business is really an 8-, 12-, 14-year horizon when we look at investments," Woebcken said on the sidelines of the Detroit auto show.
Right... but just in case, it never hurts to make such a strategic announcement just as Trump is unleashing all the fury of the US manufacturing class on automakers, both foreign and domestic.