Home / Business / Trump faces an unsuccessful automatic job strategy when he leads to Ohio

Trump faces an unsuccessful automatic job strategy when he leads to Ohio







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                  President Donald Trump focuses on urging GM not to shut down the Lordstown factory, making it the compact Chevrolet Cruze model. Jeff Swensen / Getty Images </p>
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<p>  President Donald Trump leads Ohio Wednesday, which began in a battle with General Motors and United Auto Workers on the closure of GM's Lordstown plant, but his efforts to save manufacturing jobs have abused the car industry and can erode his loyal base in the Midwest </p>
<p>  Trump's steel and aluminum tariffs have cost Ford and GM about $ 1 billion, GM's CEO Mary Barra quoted the tariffs in November when she announced the 14,000 work cutings that included the Lordstown factory. makes things even worse, now Trump weighs new tariffs on foreign cars that can threaten hundreds of thousands of additional US jobs. </p><div>
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Reality is that auto tariffs would put Ohio in a recession, "said Dan Ujczo, a Columbus-based international trade lawyer who has carefully studied the effects of recent trade measures on Ohio companies.

Ultimately, this could endanger Trump's support in Mahoning Valley and other Great Collins beaches that voted for him in 2016.

"He will lose the other he charges auto tariffs," said Ujczo. "These people understand that you can't cut off your nose despite your face." According to a tracking survey by Morning Consult, Trump's approval rating in Ohio has decreased by 19 percentage points since January 2017.

While Trump focuses on urging GM not to close the Lordstown factory, where it is the compact Chevrolet Cruze model, the industry's economic reality is much more complicated.

Trump's simple formula for requiring specific plants to be open does not stand for the sophisticated global car industry. The automatic supply chain is global; Foreign companies build cars in the US, but with some foreign components. Similarly, cars abroad often contain American parts. And car dealers move workers from plant to plant as demand for different types of car shifts.

GM says the Ohio factory is closing because demand has softened for Cruze; The company says it is talking to employees about moving to other facilities.

It is unusual for any president, especially a republican, to tell private manufacturers how to run their businesses. "There is a mindset that these decisions are best handed over to the companies and unions," said Marick Masters, director of the lab at Wayne State University in Detroit.

It is even more unusual for a president to blame the union for closing the plant. Dave Green, president of United Auto Workers Local at Lordstown, seems to have tricked Trump Sunday when he told Fox News that Trump's 2018 tax cut incentive imports. Or maybe Trump was annoyed at Green to let the press know in February that he had written the president of Lordstown closure in July 2018 and received no reply.

Whatever the specific provocation, Trump Sunday tweeted that "Democrat UAW Local 1112 President David Green should get his act together and produce", then followed up a tweet who noted GM: s Barra "blamed the UAW Union" for the suspension, which led to a Angry Retort from the UAW: "Corporations shut down plants, workers do not."

Trump's previous efforts to intervene in vehicle manufacturing have, at best, resulted in weak profits.

Trump entered Ford during the 2016 freight job campaign to Mexico, when claimed credit in early January 2017 when Ford in an unrelated move announced that it would create 700 jobs in Michigan to build electric and self-driving cars – while expanding two o plants in Mexico.

Trump was also annoyed in June 2018 when Harley-Davidson said it would offshore an unspecified number of jobs to offset the effects of the European tariffs imposed on Trump's steel prices. Trump was so furious that he said he would support a boycott of Harley-Davidson which led to the company's strongest sales fall of almost a decade.

Trump's protectionist policies distort the profits of automakers, even though they employ much more workers than the steel and aluminum industry, the tariffs are designed to protect.

Overall, the car and automobile manufacturers in the United States employ more than one million workers, according to the Bureau of Labor Statistics. By comparison, the steel industry was approximately 81,000 employees in 2017 and workers in aluminum factories amounted to almost 13,000 the same year.

The US aluminum industry has created only 100 jobs since the tariffs came into effect while the steel industry increased employment by 6,200, according to the White House's financial report from the president released on Tuesday.

Wednesday's visit to Joint Systems Manufacturing in Lima, Ohio, Trump could call on the president to confirm his national security policy for steel and aluminum tariffs. It can be a good talking point at a factory that builds military tanks, but probably not on the Ford engine plant just up the road. Trump uses the same national security statement as he weighs tariffs on foreign cars and car parts.

"The metal prices are the highest they compare to anywhere else in the world where cars are manufactured," says Kristin Dziczek, vice president of industry, labor and the economy of the nonprofit vehicle research center.

Supporters of Trump's customs policy say that action is necessary to bring about long-term changes in China's unfair trade practices and meaningful concessions from trade negotiations. Consistent employment growth in the manufacturing sector also contributes to some tariffs having a marginal favorable effect on the economy as a whole.

Still, uncertainty caused by steel and aluminum tariffs and the threat to car prices have contributed to a steep decline in industrial investment since 2017, according to Dziczek. Average quarterly investment in the auto industry declined to about $ 2 billion, having estimated nearly twice as much under President Barack Obama's presidency.

Despite this, foreign car manufacturers targeting the tariffs are strengthening the production in the US with investments in automatic plants over the Midwest and South.

Although some companies like GM are sending jobs, Fiat Chrysler last month announced plans to expand the production of SUV in Michigan and set up 6,500 jobs by 2021. Last week, Toyota announced that it would increase investment in its US operations with the addition of 600 new jobs before 2021.

Japanese car companies have increased US employment by more than 27 percent since 2011, according to a recent study by the Japan Automobile Manufacturers Association. This corresponds to 92,000 US workers directly employed by Japanese companies and 355,000 employees employed by dealer networks.

Akio Toyoda, president of Toyota Motor Corp., said that the threat of customs on the basis of national security "really makes me sad."

"No matter what direction we go, we will never leave the US. We will stay here," Toyoda said on March 14 at an event hosted by The Economic Club of Washington, D.C.

International trade makes it difficult to distinguish between what is really American and what is really foreign. An American-made Ford Fusion, observed Reed College economist Kimberly Clausing, is probably less "American" than a Japanese Honda Accord, as only 20 percent of the Fusion parts are American-made, compared to 80 percent of Accords.

Although 80 percent of the car's component is American made, the Michigan-based Center for Auto Research estimates a 25 percent tariff on imported car parts would increase by nearly 4 percent the price of a $ 35,000 car.

"Trump doesn't seem to understand that the car production process involves intensive global supply chains," Clausing says.

Ian Kullgren contributed to reporting.


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