Trump to General Motors: Make Chevy Cruzes in US or pay big tax

GM responded by saying all Cruze sedans sold in U.S. are made in Lordstown

Workers at General Motors Lordstown strive to keep up with production demand for the Chevy Cruze.

YOUNGSTOWN, Ohio (AP/WKBN) – In another tweet targeting a U.S. company, President-elect Donald Trump is threatening to slap a tax on General Motors for importing compact cars to the U.S. from Mexico.

GM makes the vast majority of compact Chevrolet Cruzes in Lordstown.

Trump tweeted early Tuesday that GM is sending Mexican-made Cruzes to the U.S. tax-free. He told GM to stop or pay a “big border tax.”

Within hours, GM responded:

General Motors manufacturers the Chevrolet Cruze sedan in Lordstown, Ohio. All Chevrolet Cruze sedans sold in the U.S. are built in GM’s assembly plant in Lordstown, Ohio. GM builds the Chevrolet Cruze hatchback for global markets in Mexico, with a small number sold in the U.S.

Youngstown State Political Science Chair Dr. Paul Sracic said Trump uses social media to not only communicate with the public, but to also put immediate pressure on those he’s targeting.

“It’s the speed of Twitter plus the bluntness of Trump,” he said. “I mean, General Motors had to respond this morning. The environment has changed. General Motors stock moved in response to it.”

Shares of GM fell 0.4 percent to $34.70 in pre-market trading after Trump’s tweet.

In June, WKBN 27 First News reported the automaker planned to build what it called a “limited” number of Cruze sedans at its plant in Mexico. Sources said the local plant had trouble building enough of the hot-selling cars to meet all the demand in dealer showrooms, so GM turned to Mexico to help increase supplies.

Cruzes for sale in other countries around the globe are also built there, as well as the hatchback model of the car, which is imported into this country.

U.S. Senator Rob Portman said lawmakers have made it too easy for companies to leave.

“When you have a tax policy that says we’re gonna have the highest rate of tax here in the United States for countries that do business here and we’re gonna have an international system that’s totally uncompetitive compared to the rest of the world, you’re gonna see jobs go, you’re gonna see whole businesses go.”

Portman said that has to change.

“It’s trade policy, but it’s also how to make sure that it makes sense to create that job in America by creating a better environment here, and we’re not doing that,” he said. “We gotta get this done, we gotta fix it. I mean, it’s crazy that we’re actually exporting jobs and even investment in business overseas because our tax policy is so antiquated, so out-of date, and this is an opportunity for us.”

Congressman Bill Johnson tweeted Thursday morning, urging General Motors to keep production in Ohio:

In the meantime, Sracic predicted there may be many more tweets from the new president.

“He doesn’t have to have it filtered by the news media or anyone else. It goes right out there and it’s simply automatically reported.”

The importing of Mexican-built Cruzes began in September and ended at some point last month. Lordstown union leaders said workers in Mexico built about 3,000 Cruze sedans for sale in the U.S. between September and December.

A GM spokesperson said the model coming here accounts for a very small volume.

Union leaders said if GM opts to re-tool the Lordstown plant to build hatchbacks, as well as sedans, here, they will take the work. However, they understand it would not mean enough extra work to make up for all the jobs that would be lost when the third shift goes away later this month.

In November, GM officials announced they were eliminating the third shift at Lordstown, blaming increased demand for SUVs and pickups and less of a need for fuel-efficient cars.

Last year, Trump also threatened to tax Ford, which planned to shift production of the compact Focus to Mexico. Later Tuesday morning, Ford announced that it wouldn’t move production to Mexico, announcing plans to create 700 U.S. jobs.

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