Published: Wed, November 28, 2018
Money | By Hannah Jacobs

Trump threatens General Motors subsidies over plant closings

Trump threatens General Motors subsidies over plant closings

United States president Donald Trump blasted General Motors (GM) for making plans to close seven production plants, including four in the USA, and demanded that the firm find a vehicle that sells in sufficient quantities to be able to increase the company's activities in OH, a key U.S. election battleground. Republican Senator Rob Portman told GM chief executive Mary Barra on Monday that the company should bring a new product to the plant and he also urged GM "to at least reallocate some of the production and employees to the Toledo GM plant".

Larry Kudlow, director of the National Economic Council, says the disappointment has been amplified by the fact the cuts are coming in the wake of the newly reached U.S. -Mexico-Canada Agreement, one of Trump's signature achievements on trade.

Unions were also angered by the move and the UAW said "General Motors decision ... to stop production at the Lordstown, Ohio, and Hamtramck, Michigan, assembly plants will idle thousands of workers, and will not go unchallenged". "We are now looking at cutting all @GM subsidies, including. for electric cars", Trump said on Twitter.

The reduction includes about 8,000 white-collar employees, or 15 percent of GM's North American white-collar workforce. The company said this is part of a plan that restructures to cut costs and focus more on autonomous and electric vehicles.

Barra told reporters the company is making the cuts "to get in front of it while the company is strong and while the economy is strong".

The White House is threatening to curtail federal subsidies for electric cars in response to General Motors' decision to shut down auto production at plants in OH and MI.


Congressman Bill Johnson said he was very disappointed about GM's decision to close the plant, but was hopeful for the future.

GM's Lordstown, Ohio, plant is one of five in North America that the company plans to shut down.

Kudlow, who met with Barra on Monday, said that Trump felt betrayed by GM, which the government had been trying to help.

"These actions will increase the long-term profit and cash generation potential of the company and improve resilience through the cycle", Barra said.

The decision is "devastating" for workers at the plant and auto suppliers, but Oshawa has adapted over the years and will survive this as well, DesRosiers added.

But it was hard to miss the fact that the bulk of the USA cuts came in the Midwest Rust Belt, a region that was instrumental in elevating Trump and his jobs-promising, "America First" agenda to the White House in 2016.


She said GM is still hiring people with expertise in software and electric and autonomous vehicles. The U.S. saved General Motors, and this is the THANKS we get!

"I don't know how I'm going to feed my family", Matt Smith, a worker at the Ontario factory, said Monday outside the plant's south gate, where workers blocked trucks from entering or leaving.

The BBC has contacted GM for comment on the president's remarks, and is waiting for a response.

"We need to make sure that we are well positioned to compete, not just over the next few years, but well beyond", she said. Some UAW workers could land jobs at other GM factories, but many will face uncertain futures unless GM reverses course.

"Well, it's one plant in Ohio". The factory is still in operation and now builds the Sonic and the Bolt electric vehicle.

After we are sworn in, Jon Husted and I will be visiting the Detroit Auto Show in January to make our case in-person to GM about the future of the plant. Also, GM imports the Buick Envision midsize SUV from China.


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