Fact Check: Trump's Statements On Auto Industry Are Misleading
By Tom Krisher, AP Auto Writer
DETROIT (AP) - President-elect Donald Trump has a long list of deceptive statements about Ford Motor Co. and the auto industry, and he added to that list this week.
Trump's tweet on Thursday asserting that he had dissuaded Ford from moving a Kentucky factory to Mexico was a stretch, at the very least. The company has no intention of moving the plant, and it had already agreed to keep production of one specific model there.
Throughout the campaign, Trump accused Ford of exporting U.S. jobs south of the border and, in alarming terms, contended that auto jobs are leaving the country in mass. He also misstated the impact of trade agreements on U.S. auto jobs and has threatened to impose a 35 percent tariff on goods imported from Mexico.
While it's true that Ford and others have spent billions of dollars on assembly and parts plants in Mexico, the industry also has added thousands of U.S. jobs since auto sales recovered from the Great Recession. There aren't as many jobs at U.S. auto plants as there were a decade ago, but that's due more to automation than to the free-trade agreements that Trump has criticized.
Here are how Trump's statements about Ford and the industry stack up with the facts:
TRUMP: "Just got a call from my friend Bill Ford, Chairman of Ford, who advised me that he will be keeping the Lincoln plant in Kentucky - no Mexico."
THE FACTS: Ford never had any intention of moving a factory from Kentucky to Mexico. But it did propose shifting production of the Lincoln MKC small SUV from Louisville to Cuautitlan, Mexico. The idea was to free assembly-line space to make more Ford Escapes, which are made on the same line as the MKC. In a deal with the United Auto Workers union, Ford agreed to invest $700 million in the plant and not cut any jobs, since workers would still make Escapes.
So, while Trump may have been responsible for keeping production of the MKC in Louisville — Ford wouldn't say if he directly played a role — there should be little if any impact on the Louisville plant's 4,700 workers. Ford has sold only 21,000 MKCs so far this year, compared with 258,000 Escapes. Also, Escape sales have been falling since July, so the need for added factory capacity to build more of them isn't needed.
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TRUMP: "Our jobs are fleeing the country. They're going to Mexico. They're going to many other countries. ... Ford is leaving ... thousands of jobs leaving Michigan, leaving Ohio."
THE FACTS: Trump was referring to Ford's plans to shift all small-car production to Mexico to take advantage of lower wages. The company announced this year that it would move the Ford Focus and C-Max from suburban Detroit to a new plant south of the border. But the move wouldn't cost any U.S. jobs. The 3,700 workers at the plant in Wayne, Michigan, that now makes the small cars will stay employed building a new SUV and small pickup truck.
Trump and his supporters contend the Mexican jobs could have been added in the U.S. if Ford built a new factory here instead of in Mexico. But Ford says it's nearly impossible to make money building small cars in the U.S., while Mexico's lower costs of production, including wages, allow the automaker to turn a profit on the vehicles.
As for jobs fleeing the U.S., the U.S. auto industry has actually added 300,000 jobs since June 2009, when the recession ended.
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TRUMP: When he becomes president "The auto industry will come roaring back."
THE FACTS: The industry has already roared back from the financial crisis. Total U.S. auto sales reached a record level of 17.5 million last year. They may tail off slightly this year, but sales are expected to stay near the record or even grow during the next several years. The resurgence has benefited both U.S.-based and foreign automakers, many of which have U.S. factories.
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TRUMP: "According to the Bureau of Labor Statistics, before NAFTA went into effect, there were 285,000 auto workers in Michigan. Today, that number is only 160,000."
THE FACTS: Michigan actually added jobs after the North American Free Trade Agreement began in 1994, when auto-manufacturing and auto-parts plants employed roughly 280,000 workers. Over the next six years, their ranks increased to 320,000. But the jobs started falling in Michigan as U.S. automakers lost market share, automation increased and the Great Recession hit. Auto employment bottomed out at 95,000 in 2009 and recovered to about 165,000 as of September.
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