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President Donald Trump has threatened to punish General Motors after the company's decision to close manufacturing plants in the Midwest and lay off thousands of American workers.
A day after the news of the layoffs shook the sector and raised a potential political problem for the president, he responded to the earlier threat that the builder "is opening up better" to open a new factory.
He threatened to scrap subsidies for electric cars – while GM was looking to reconfigure its supply chain, get rid of unpopular models and refocus on vehicles it thought could sell at home. 39; future.
"Very disappointed with the decision of General Motors and General Manager Mary Barra to shut down plants in Ohio, Michigan and Maryland. Nothing is closed in Mexico and China, "tweeted Trump Tuesday at a press conference in the White House.
"The United States has saved General Motors and it's THANK YOU! We are now considering removing all @GM subsidies, including … for electric cars, "he said.
President Donald Trump on Monday railed at Genetal Motors' chief executive, Mary Barra, claiming that she was scheduled to reopen an Ohio-based auto plant that was scheduled to close. Ohio is a critical state for the president who must win if he hopes to be re-elected in 2020
"General Motors made a big bet in China a few years ago, when building factories (and Mexico) – do not think this bet will be profitable. I am here to protect American workers! Trump added.
His economic adviser, Lawrence Kudlow, alluded to the threat during his own appearance in the briefing room: "It seems that GM prefers to build its electric cars in China rather than in the United States. We will look at some subsidies for electric cars and others, whether they apply or not. I can not say anything definitive about it, "said Kudlow.
Asked about the move, Sarah Sanders, White House press secretary, said, "I do not know if there is a specific timetable. As he said, he is trying to find out what these options might look like. The president wants American companies to build cars here in America and not abroad. And he hopes GM will continue to do it here.
THREAT: Trump said that he was "very disappointed" with GM's factory closures
The President has threatened to end subsidies for the production of electric cars by GM
Subsidies to support the industry include tax credits of up to $ 7,500 for new electric vehicles purchased in the United States based on battery capacity and other factors. It is limited to 200,000 vehicles per builder, according to the Energy Department.
These grants, which accrue to each taxpayer, were promulgated by Congress in 2008 and can not be unilaterally removed by the President. It was not clear right away if Trump was considering other grants. They have contributed to the growth of the hybrid electric industry, where Japan is a leader and the US manufacturers are trying to compete.
Shares of the company immediately dropped to 14:05, when Trump sent his threatening tweet of subsidies. It was down 42 cents in five minutes and nearly 60 cents a share in half an hour, rising on the day of the announcement of layoffs.
Trump pulled his tweets while a briefing at the White House was underway
President Donald Trump, angry, railed against General Motors on Monday after the company announced plans to close five auto manufacturing plants and put 14,700 people out of work, some of whom would be voters in the crucial state of Ohio.
The plants would close near Detroit, Ohio and near Toronto.
He told the Wall Street Journal that the company should stop making cars in China and put its US factories to full capacity.
"They'd better open a new plant there very quickly," said the president, adding, "I love Ohio."
GM will stop producing cars and transmissions in factories until 2019. In total, six car models have been abandoned: the Chevrolet Volt, the Chevrolet Cruze, the Chevrolet Impala car, Cadillac XTS, Buick LaCrosse and Cadillac CT6.
This leaves the company with nine remaining car models.
And the Cadillac CT6 will be killed in the United States after mid-2019, although it will continue to be sold in China.
Trump said he spoke with GM CEO Mary Barra on Monday and said "I'm telling you, you're playing with the wrong person."
He told reporters while he was leaving the White House for two political rallies in Mississippi that the United States had done a lot for General Motors. They better go back to Ohio and soon.
The president won the Buckeye State by 8 percentage points in 2016; his re-election campaign should focus on a stronger economic recovery.
The General Motors Lordstown complex located in Warren, Ohio, is the main badembly plant for the compact model of the Chevrolet Cruze, which the company is phasing out due to weak sales.
POLICY: Dave Green, President of United Auto Workers Local 1112, spoke at the union's headquarters in Lordstown, Ohio, in June; his union has approved a Democratic senator who has been re-elected in a state where Trump must rally to his side
Given the inherent advantages of Demorcats within the Electoral College, the proportional voting system that elects US presidents, it is difficult for Republicans to win without imposing themselves in Ohio.
In addition to reducing its workforce, GM announced Monday that it would eliminate some models whose sales have underperformed expectations.
One of these, the Chevy Cruze, is badembled at the plant in Lordstown, Ohio, which is now scheduled for the manufacture of mothballs.
Trump told reporters that Barra had told him that the elimination of the Cruze had "nothing to do with tariffs" – only with falling sales.
His answer, he said, was that she should "get a car that sells well and hand it over to [Ohio]& # 39;
"I'm not happy about what she's done," Trump said about Barra. "You know, the United States has saved General Motors, and for it, leaving this company from Ohio is not a good thing.
This map shows the votes of the Electoral College that were awarded to Donald Trump (in red) and Hillary Clinton (in blue) in 2016; voters, who actually choose the president, are redistributed to states once a decade as part of the US census, and Republicans traditionally need the 18 votes (black arrow above) of Ohio to win the White House.
About 6,000 factory workers (photographed at the Oshawa plant) could lose jobs in the United States and Canada, but some could be transferred to truck manufacturing plants. The plan will save the company $ 6 billion by 2020, according to GM
GM's restructuring at the plant's closure aims to save $ 6 billion while the company is now focusing on electric and autonomous cars.
In addition to the Ohio plant, it will close two in the Detroit subway and one in Ontario, Canada.
Too many factories are only designed to make older models, while GM wants to reorganize to focus on low-emission hybrid vehicles.
Mary Barra, President and CEO of GM, said the savings were needed to invest in the future.
"We are transforming this society," Barra told the Detroit Free Press. "This sector is evolving very quickly in terms of propulsion, autonomous driving and carpooling. We want to be in the vanguard while society is strong and the economy is strong, "she said.
This decision will not affect GM's commodities, such as its pickup trucks, SUVs and certain cars, including its full-size Chevrolet Silverado 2019 pickup trucks and GMC Sierra.
"These are good architectures from the point of view of fuel economy … we will continue to put them on the market, but we can reduce our capital expenditure while investing in electric and autonomous vehicles," he said. Barra said. "You will see a larger share of the investments in autonomous and electric vehicles, both by a capital expenditure and by an increase in hires for electrical and autonomous engineer positions.
GM will lay off 14,700 workers and employees in North America and prepare to close five plants in the event of restructuring to reduce costs and focus more on autonomous and electric vehicles. One of these closures would be the Oshawa plant in Canada (photo)
In a press release, the company announced that it would close the Detroit-Hamtramck badembly plant in Detroit and the transmission facilities from Warren to Warren.
Other plants that are closing include the Oshawa Assembly Plant in Oshawa, Ontario, the Lordstown Assembly in Warren, Ohio and the facilities. from Baltimore to White Marsh, Maryland.
The company also plans to stop building several models badembled in these plants, including the Chevrolet Cruze, Cadillac CT6 and Buick LaCrosse.
"The steps we take today continue to transform our society so that it is extremely agile, resilient and profitable, while leaving us the opportunity to invest in the future," he said. said Mary Barra, President and CEO of GM.
"We recognize the need to keep up with changing market conditions and customer preferences in order to position our company for long-term success."
The reduction includes 8,100 white-collar workers, some of whom will acquire and others who will be made redundant. Most of the factories involved are building cars that will not be sold in the US after next year.
They could close or they could have different vehicles built. They will be part of the contract negotiations with the United Auto Workers union next year.
About 6,000 factory workers could lose jobs in the United States and Canada, but some could be transferred to truck manufacturing plants.
The plan will save the company $ 6 billion by 2020, according to GM.
This announcement is the largest restructuring in North America of the US automaker No. 1 since its bankruptcy ten years ago.
The Monday shutdown of GM's plant in Oshawa, Ont., Was confirmed Sunday night by an official aware of the decision.
GM opened its plant in Oshawa, near Toronto, in 1953. This plant is used to manufacture Cadillac XTS and Chevrolet Impala sedans as well as Chevrolet Silverado and GMC Sierra trucks.
The company has three other sites in Ontario. It is unclear whether they will also be affected
GM needs to reorganize the company as it focuses on low-emission hybrid vehicles, a technology that is not at the forefront of the Canadian factory.
Too many GM factories are dedicated to manufacturing slow-moving cars and the company can no longer afford to keep them all running without making tough decisions. But the political atmosphere could limit realistic choices for the Detroit automaker.
In a press release, GM officials announced the closure of the Lordstown Assembly (pictured) in Warren, Ohio.
The company will also close the Detroit-Hamtramck badembly plant (photo) in Detroit
The company said these moves would allow it to continue to focus on crossovers, SUVs and trucks.
GM plans to cut 25% of management and 15% of contract and salaried staff.
"These stocks will increase the company's long-term earnings and cash-generating potential and improve resilience throughout the cycle," Barra said in a statement.
The closure of the Lordstown plant in Ohio has not shocked some badysts who have predicted that this location would be one of GM's targets.
The produced car is also built in Mexico. The once-busy factory has already lost two of its three shifts and 3,000 unionized jobs since the beginning of last year.
Barra has not established a link between Monday's announced cuts and tariff pressures, but said trade costs are among the "hurdles" GM faces in facing broader technological changes and mutations of the market.
With US car sales lagging behind, many auto plants are no longer a single workstation, including the Hamtramck and Lordstown badembly plants.
In general, the automotive industry estimates that if a plant has a production capacity of less than 80% of its production capacity, it loses money.
GM has several factories that work well below that. The consulting firm LMC estimates that Lordstown will only operate at 31% of its production capacity in 2018.
Rivals Ford Motor Co and Fiat Chrysler Automobiles NV both reduced their production of US cars. Ford announced in April its intention to stop building almost all cars in North America.
The global slowdown in pbadenger car sales has begun to accelerate in 2017.
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