Donald Trump prods General Motors over its auto plants in China

Reuters WASHINGTON | Updated on August 30, 2019

US President Donald Trump.   -  Reuters

US President Donald Trump, who is engaged in a trade war with Beijing, said, on Friday, that the largest US automaker, General Motors Co, should begin moving its operations back to the United States.

“General Motors, which was once the Giant of Detroit, is now one of the smallest auto manufacturers there. They moved major plants to China, BEFORE I CAME INTO OFFICE. This was done despite the saving help given them by the USA. Now they should start moving back to America again?” Trump said in a post on Twitter.

Trump appeared to be referring to a Bloomberg News story that reported GM's hourly workforce of 46,000 US workers has fallen behind Fiat Chrysler, as the smallest of the Detroit Three automakers. Over the past four decades, GM has dramatically cut the size of its overall US workforce, which numbered nearly 6,20,000 in 1979.

GM did not immediately comment on Trump's tweets.

Trump's ire with GM comes as contract talks with the United Auto Workers union with the Detroit Three automakers intensify ahead of a September 14 deadline. Trump has previously attacked GM for building vehicles in Mexico and for ending production at plants in Michigan, Ohio and Maryland.

GM's decision to close four plants in the United States is a central issue in the contract talks.

China is the worlds largest auto market and government policy favours automakers assembling vehicles there, and not importing them from overseas.

In response to Trumps latest tariffs, China said last week it will reinstitute 25 per cent tariffs on US-made vehicles. GM sold 3.6 million vehicles in China last year accounting for 43 per cent of its worldwide sales. GM booked $2 billion in equity income from its China operations last year.

GM imports a small number of vehicles from China. In June, the Trump administration rejected a request from GM to exempt its Chinese-made Buick Envision from a 25 per cent US tariff on sport utility vehicle models. The midsize SUV has become a target for US critics of Chinese-made goods, including leaders of the UAW members in key political swing states such as Michigan and Ohio.

Published on August 30, 2019

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