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General Motors will close five factories and establish employees: Trump responded angrily – 11/27/2018


The United States' bonanza situation, with its rising economy and unemployment at low historical levels, is beginning to crack. General Motors, one of the most iconic companies in the country, announced this will release 14,500 employees, shut down five factories and will finish producing six sedans.

The move is a powerful blow to the President's promises Donald Trump which would generate new jobs in the automotive industry. That's why the president reacted indignantly, criticizing the company's decision.

Lordstown Factory, where the Chevrolet Cruze is manufactured. (AP)

Lordstown Factory, where the Chevrolet Cruze is manufactured. (AP)

Trump immediately spoke with General Motors CEO Mary Barra to express his dissatisfaction. "I talked to her and I expressed this I'm not happy with what she did. I was very hard. You know, the United States saved General Motors and that she takes off Ohio's company is not good, "he said.

Then Trump wrote several tweets in which he threatened the company. "Very disappointed by General Motors and its chief executive, Mary Barra, for plant closures in Ohio, Michigan and Maryland.The United States saved General Motors, and that is the gratitude I have received! We are now studying the reduction of all subsidies, including those for electric cars, "he said.

The President, as is usually the case in other conflicts, once again used nationalist arguments to question the company: "General Motors made a big bet in China years ago when they built plants there. And in Mexico. I do not think the bet will win. I'm here to protect the American workers! "

General Motors announced it will settle 15% of its employees. According to those concerned, it includes 3,300 workers in the United States, another 2,600 in Canada and 8,000 administrative and executive officials. It would also close four assembly plants across the US – one in Ohio, one in Maryland and two in Michigan – and one in Canada.

The measure responds to two weight factors. First of all, at changes in demand and new business requirements of the modern world. Secondly, to the boomerang effect of the trade war launched by Trump against China.

Lordstown plant in Ohio, which will be closed in the coming months. (AP)

Lordstown plant in Ohio, which will be closed in the coming months. (AP)

In the fight with the Asian giant the government has imposed high rates on vehicles, which caused replicas of the Chinese authorities. This increased the prices of imported and exported cars.

In this sense, we must add protectionist measures such as the application of 25% for steel tariffs and 10% for aluminum, from both China and other supplying countries. This has had a direct impact on car manufacturers.

Barra admitted that tariffs are a serious problem, such as tariffs, but it clarifies that these are not the only cause of restructuring. The company, he said, makes these changes prepare for the future. "We recognize the need to anticipate changing market conditions and customer preferences to position our company for long-term success," he said.

"It is expected that more than 75% of GM's global sales volume will come from five vehicle architectures at the beginning of the next decade," Barra said. In this way, GM is trying to focus its production on the most profitable vehicles, such as SUVs and SUVs.

General Motors workers in Canada. (AP)

General Motors workers in Canada. (AP)

In October, almost 65% of new vehicles sold in the US were trucks or trucks, 15% more than five years ago. Most plants affected by this restructuring produce vehicles that will not be sold in the region. One of them will be the Chevrolet Cruze. The future of the other plants will depend on the negotiations with the unions.

The company is also preparing electrical and autonomous machines. GM CEO underlined that as cars and trucks become more complex, the company will need more programmers and fewer engineers working on internal combustion engines. "Vehicles depend more and more on software. We will need a lot of technical resources with millions of codes, "he said.

The drastic measure of General Motors directly hit the Trump policy, who had promised to revitalize job creation in the US industrial belt. and promote car manufacturing within the country. Ohio, where one of the plants will be closed, is one of the key states on the electoral map and helped him come to power in the 2016 elections.

The picture could become even more complicated because General Motors anticipated just what other companies are planning to do. According to experts, Ford could adopt a similar policy in the coming months.

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