Ford, Twitter, Trump, and American Jobs moving Elsewhere

During the first phase of the recent debate for job creator and US military supporter Donald Trump, he was attacking the US automotive industry for exporting its jobs to Mexico. He directed most ire at the Ford Motor Company. He spoke about their small car division shifting thousands of jobs leaving Michigan and Ohio.

After a number of concerned citizens had made their dismay known on Twitter, Ford spent the evening engaging in damage control over the social network.

 

https://en.wikipedia.org/wiki/Ford_C-Max#/media/File:Ford_C-Max_1.6_TDCi_ECOnetic_Trend_(II)_%E2%80%93_Frontansicht,_23._September_2012,_D%C3%BCsseldorf.jpg

Ford said that they were phasing out the production of their C-Max and Focus compact vehicles from Michigan to Mexico. Since the Fiesta is already being produced in Mexico, this means Ford will not be making any small cars in the US.

But, one thing which Ford's social media team was finding hard to explain was that thousands of jobs weren't leaving the country. The plant workers from Michigan will now work on pickup trucks and SUVs which earn the company greater profits. General Motors, BMW, Mazda, Nissan, Kia, Honda, etc. all have assembly plants in Mexico for producing their less-expensive cars. 

This makes them cheaper to export to the rest of the world. The car-making capacity in Mexico is supposed to rise dramatically in the next few years.

Now the ironic aspect of this is that Ford and other companies would do more business in America under Trump since Trump will lower the corporate tax rate (which is the highest in the world) and curtail the EPA’s profound anti-business rules. Hillary Clinton, the Democratic nominee, would do no such thing. In fact, she may even give the EPA (Environmental Protection Agency) more power which will be awesome for Mexico and other countries but not so enlightening for the American employee nor the economy.

Trump has been emphasizing his economic plan which will bring growth back to America which it really has not seen since 2006. The sad thing about this is that Ford and Trump should be more on the same page. Perhaps they will be in the future. 

 

https://commons.wikimedia.org/wiki/File:Ford_C-Max_1.6_TDCi_ECOnetic_Trend_(II)_%E2%80%93_Frontansicht,_23._September_2012,_D%C3%BCsseldorf.jpg#/media/File:Ford_C-Max_1.6_TDCi_ECOnetic_Trend_(II)_%E2%80%93_Heckansicht,_23._September_2012,_D%C3%BCsseldorf.jpg

Due to the supply chain in place across North America, 40 percent of the vehicles made in Mexico will have US parts. In fact, US exports to Mexico have doubled from 2005-2014. It is currently at $18.4 billion. This is one of the reasons why the number of workers has increased on both sides of the border but not by that much since neither country is exactly doing well economically. 

US jobs have grown by 15 percent since 2008 in the automobile industry. Mexican jobs have grown by around 40 percent. Just imagine what they would be if American corporations and businesses were not plagued by the ACA (Affordable Care Act) which pushes workers to 30 hour work weeks and taxes business more if they reach the 50 employee plateau level. 

Still, it was Ford who caused all of this uproar by going on and on about wanting to move to Mexico last year. Why does the current President, President Obama, not lower the corporate tax rate? In the long run, it is worth remembering that every car manufacturer is currently facing some radical changes in what, how, and why they are building instead of just where.

One of the other reasons why small car production is now shifting outside the United States is because Americans are no longer looking to buy these cars like they used to. This is because fuel prices are relatively cheap because of oil shale development in Republican led states like Texas and North Dakota and so on (which forced OPEC to increase production which led to low fuel prices). The EPA would stop this development if they had their way. 

High resale values when it comes to large vehicles like SUVs and crossovers and cheap gas (as just mentioned) have made this segment far more popular among new vehicle buyers. 

They are usually suburban dwelling, older individuals. As far as the younger urbanites who at one point would have been more than happy to pick up a new Ford Focus right after graduation, they no longer see the need to own a car thanks to the likes of Uber and Zipcar. But in many other cities, younger people are buying vehicles just not small ones. 

 https://upload.wikimedia.org/wikipedia/commons/f/f0/Ford_Grand_C-Max_Champions_Edition_%28II%29_%E2%80%93_Heckansicht%2C_31._Dezember_2012%2C_Ratingen.jpg

Another big announcement by Ford in the middle of September was about their plans to now position itself as a mainstream manufacturer of electric and most probably autonomous cars for a car-sharing service in the near future. 

Like all of the auto manufacturers out there today, they see the American-made car is dying a very slow death. The only real surprise here is the amount of people who aren't aware of this just as yet. What is even more surprising and worrisome is how many people have no idea why jobs go overseas what the corporate tax rate is. America gets what it deserves as in all democracies.