Start America Trump calls for GM to stop production in China

Trump calls for GM to stop production in China


The planned cancellation of thousands of jobs and possible closure of several plants at the largest US car maker General Motors (GM) brings President Donald Trump into rage. The head of government reacted with extreme annoyance to GM management announcements of significant job cuts and threatened with consequences.

„You should damn well open a new factory there,“ Trump told the „Wall Street Journal“ about the imminent departure from a large Ohio site. He told GM boss Mary Barra in a conversation on Sunday, she has „a problem“, should the work remain permanently closed.

General Motors wants to close several plants with the conversion to electric cars and massively reduce personnel. By the end of 2020, should be saved annually six billion US dollars (5.3 billion euros), announced the largest US carmaker on Monday. The costs are expected to fall by $ 4.5 billion and investment by $ 1.5 billion per year. The savings are said to free up enough funds to invest in electromobility.

An overall job reduction of 15 percent in North America is expected, which would mean the loss of 8,000 jobs. This is accompanied by the reduction of 25 percent of all executive jobs. The billions in restructuring costs are to be financed by credit. „We are adapting the capacity of the reality in the market,“ said GM boss Mary Barra. Priority investments would have platforms for the next generation of battery-powered cars.

Falling demand

The reason for this is the sharp drop in demand for limousines in the US and rising costs, such as the higher import duties imposed on steel by US President Donald Trump. General Motors shares rose more than five percent on the stock market.

For Trump, the measures are a defeat, he has promised a reindustrialization and promised in particular new jobs in the auto industry. This was not least due to trade barriers, which should make the relocation of car production to cheaper manufacturing countries unattractive.

Trump advises to car, „that sells well“

In an interview published on Monday by the „Wall Street Journal“ Trump asked GM to stop car production in China. GM should prefer to produce its vehicles in the USA. To reporters, Trump said he was not happy with GM’s decision to shut down a plant in Lordstown, Ohio. He told GM boss Mary Barra. Barra assured him that the measure had nothing to do with the recently imposed protective tariffs. The decision, however, is due to meager sales figures.

He remained tough on tariffs against China, assuming that existing tariffs on Chinese goods worth $ 200 billion will be raised to 25 percent from ten percent. It is „very unlikely“ that he will comply with the demands of the People’s Republic and renounce an increase, said Trump the „Wall Street Journal“.

Several works are closed

For the time being, production is being stopped in several assembly plants – in Lordstown, Ohio, Hamtramck, Michigan and Oshawa, Ontario. In addition, auto-assembly factories in Baltimore, Maryland and Warren, Michigan, will not be assigned any further orders after 2019. This is also threatening the closure of these parts.

The United Auto Workers union has already targeted the measures. One would fight the savings by all available measures, it was said.

(APA, Reuters)