Saturday, June 30, 2018

General Motors: Trump Tariffs Could Lead to GM Downsizing in USA

More Trump supporters may be losing their jobs or facing vastly higher auto prices if the narcissistic cretin-in-chief in the White House proceeds with his ill-conceived tariffs.  Instead of increasing American jobs, the tariffs seem headed toward forcing U.S. manufacturers to move operations out of the USA as Harley-Davidson has announced it is doing.  Now, General Motors is warning that it will take a similar path if Der Trumpenf├╝hrer continues his push for tariffs.  The good news, of course, is that the job losses will be concentrated in states that went for Trump.  If this happens, karma will certainly bite those who allowed racism and bigotry to dupe them into voting against their own economic best interests (as you can tell, I have a very hard time feeling even a shred of sympathy for these people).  Bloomberg looks at what Trump voters may have rain down on them if GM proceeds with moving operations out of the USA.  Here are highlights:

General Motors Co. issued a stern warning to the Trump administration that it could shrink U.S. operations and cut jobs if tariffs are broadly applied to imported vehicles and auto parts. “Increased import tariffs could lead to a smaller GM, a reduced presence at home and risk less -- not more -- U.S. jobs,” the nation’s largest automaker said in comments submitted Friday to the Commerce Department.
That such a blunt statement came from GM -- a company run by a CEO, Mary Barra, whose normal tack is to avoid the political fray and let trade groups address the president’s policies -- was surprising to industry observers. And it underscored how high she, and many industrial leaders, believe the stakes are as [Trump] the president sinks the U.S. into tit-for-tat trade squabbles across the globe. GM’s public pronouncement follows similar moves by Harley-Davidson Inc., Toyota Motor Corp. and Daimler AG.
The “comment suggests how severe the impact would be to GM, its employees and consumers," said Michelle Krebs, analyst with "There is a lot at stake for GM, the auto industry and the overall economy."
The probe has raised alarm among manufacturers, parts suppliers and auto retailers because all major carmakers -- including GM and Ford Motor Co. -- import a substantial share of the vehicles they sell in the U.S. from other countries. Levies on parts also would have major implications for top models like the Ford F-150 pickup and Toyota Camry sedan by boosting prices by thousands of dollars.
Barra had earlier tried to stay on good terms with Trump. She continued to serve on his Strategic and Policy Forum even after many other CEOs, such as Walt Disney’s Bob Iger and Tesla’s Elon Musk, quit to protest Trump’s withdrawal from the Paris climate agreement last year. The forum was disbanded in August following Trump’s tepid response to attacks by white supremacists in Charlottesville, Virginia.
Now, the Detroit-based maker of Chevrolet, Cadillac, Buick and GMC vehicles is warning that additional tariffs -- on top of those recently slapped on steel, aluminum and Chinese products -- could hurt GM and ultimately its customers. Higher prices would crimp sales, particularly to less-affluent consumers, and reduce the number of factory workers needed, it said.
“The threat of steep tariffs on vehicle and auto component imports risks undermining GM’s competitiveness against foreign auto producers by erecting broad brush trade barriers that increase our global costs, remove a key means of competing with manufacturers in lower-wage countries, and promote a trade environment in which we could be retaliated against in other markets,” the company said.
GM’s Chevrolet Silverado pickup was the top-selling model imported from Mexico last year, while the Chevrolet Equinox crossover was the leading vehicle sourced from Canada, according to LMC Automotive.
“GM imports a lot of pickup trucks from Mexico, so it’s a huge issue,” Alan Baum, an auto analyst in West Bloomfield, Michigan, said. “And for parts, it’s not just GM. Everyone imports a lot of electronics from Asia. Those are are high-value parts.”

Hate and bigotry often carry a high economic price - look no further than economically depressed Southwest Virginia for a case in point. 

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