Thursday, January 5, 2017

No Donald Trump did not just save jobs at Ford

Every time a company decides not to move jobs out of the United States, expect Donald Trump to claim credit and too many gullible reporters and, especially, headline writers to go along with it. Still more poisonous, expect some crafty CEOs to give Trump credit, knowing that he’ll eat it up … and maybe toss them a few favors later on.
Ford is the latest in the “no, not really” crew, with its announcement that rather than opening a factory in Mexico, it would be expanding one in Michigan. Ford’s CEO cited “the pro-growth policies [Trump] said he’s going to pursue” (translation: tax cuts for corporations and the wealthy, weakened consumer and worker protections) and called it a “vote of confidence.” Kind of a turnaround from the last time Ford and Trump were in the news, way back in September, when Trump was claiming Ford was moving jobs to Mexico that they actually weren’t and the CEO was publicly unhappy about it. It’s almost like in the interim, something happened that made Ford think sucking up to Donald Trump was a good business move.
But, you’re thinking, maybe something about this really is Trumpy. Except not.
Analysts, though, say Ford’s decision stemmed more from its long-term goals than the new administration or devotion to U.S. workers. The company aims to invest $4.5 billion in electric vehicles by 2020. (The company would not comment on the specifics of the 700 new positions.) [...]
The Ford engineers, tasked with creating these models, work in Dearborn, Mich. — 20 miles from the Flat Rock assembly plant. Moving production to Mexico would have made their jobs harder, said Brett Smith, an auto analyst at the Center for Automotive Research in Ann Arbor.
“Keeping a new technology near the engineers is an important thing, at least in the first generation,” he said. “That gives them a lot more control to monitor a system.”
Trump can be vindictive and inappropriately threaten companies’ federal contracts. He can throw tantrums that briefly depress stock prices. He can give companies good headlines and the belief that future tax breaks or favorable regulatory decisions are coming. But he can’t change market dynamics—at least not quickly, not yet. He can't bring back coal jobs. He can’t make it easier for engineers in Michigan to oversee work being done in Mexico. He’s not personally responsible for the willingness of American consumers to buy electric cars or small cars.
But if sucking up to him by giving him credit for market forces beyond his control gets a company into his good graces? Plenty of CEOs are ready to say “sign me up.” Post 

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