Trump’s tweets keep US manufacturers on their toes
(The Guardian/Neate) Donald Trump’s prolific and opinionated tweeting helped him win the US election, and now he is using Twitter to persuade big business to bend to his agenda.
There was further evidence this week that the incoming president’s unusual approach is paying off after Ford cancelled plans to open a new plant in Mexico. It came one month after a Trump-brokered agreement with United Technologies to prevent 1,100 manufacturing jobs in Indiana from being moved out of the US.
After his election win, Trump credited Twitter and other social media platforms with helping him beat Hillary Clinton despite her much higher advertising spending. “The fact that I have such power in terms of numbers with Facebook, Twitter, Instagram etc, I think it helped me win all of these races where they’re spending much more money than I spent,” he told CBS’s 60 Minutes programme.
Trump has said he will rest his Twitter fingers when he is sworn in as the 45th president on 20 January. “I’m going to do very restrained, if I use it at all,” he said in the same interview. However, he has continued to use Twitter during the transition period, taking aim at multinational companies as well as his political opponents and the media.
So far, it has produced results, with the French far-right leader Marine Le Pen applauding the Ford announcement as proof that “protectionism works”. Other companies have been affected by Trump’s solo social media campaign too.
Ford and General Motors
Carmakers Ford and GM were the latest companies to be targeted by Trump, raising the possibility that elements of US industrial strategy will be influenced and even formulated on social media.
As the US returned to work on Tuesday morning after New Year celebrations, @RealDonaldTrump, who has 18.6 million followers, tweeted:
General Motors is sending Mexican made model of Chevy Cruze to U.S. car dealers-tax free across border. Make in U.S.A.or pay big border tax!
— Donald J. Trump (@realDonaldTrump) January 3, 2017
GM shares immediately dipped 3% before recovering as the company pointed out that the vast majority of the cars it makes in Mexico are for international markets. Of the 190,000 Chevrolet Cruze hatchbacks sold in the US last year, just 4,500 were made in Mexico.
During the election campaign Trump repeatedly vowed to bring in a 35% tax on cars made in Mexico and sold in the US. At the moment, US companies can import goods from Mexico without paying any tax thanks to the North American free trade agreement (Nafta), which Trump has described as “the worst trade deal maybe ever”.
Trump has repeatedly threatened to renegotiate or “terminate” Nafta. The free trade deal had allowed cars to become a booming part of Mexico’s economy, with foreign companies investing more than $20bn (£16.3bn) in building factories in its rustbelt around Aguascalientes between 2010 and 2015.
Trump appeared to have posted the 7.30am tweet without consulting Mary Barra, GM’s chief executive, whom he appointed last month to his strategic and policy forum, which he said would help him formulate his economic and business policies.
“This forum brings together CEOs and business leaders who know what it takes to create jobs and drive economic growth,” Trump said at the time of Barra’s appointment. “My administration is committed to drawing on private sector expertise and cutting the government red tape that is holding back our businesses from hiring, innovating and expanding right here in America.”
Hours after GM’s scolding, Ford, which has regularly been targeted by Trump over manufacturing in Mexico, announced it was scrapping plans for a $1.6bn plant in San Luis Potosí and instead would invest $700m in a Michigan assembly plant.
Mark Fields, Ford’s CEO, said Trump’s “pro-growth policies” had partly led to the decision. “We look at a lot of factors as we make those,” he told Fox News. “One of the factors that we’re looking at is a more positive US manufacturing business environment under President-elect Trump and some of the pro-growth policies he said he’s going to pursue. And so this is a vote of confidence.”
Trump celebrated, tweeting:
Instead of driving jobs and wealth away, AMERICA will become the world's great magnet for INNOVATION & JOB CREATION.https://t.co/siXrptsOrt
— Donald J. Trump (@realDonaldTrump) January 3, 2017
Last month Trump criticised the aircraft manufacturer Boeing for the “out of control” cost of the new Air Force One 747 and called for the deal to be scrapped. The tweet led to about $1bn being wiped off the company’s market value before the share price recovered.
Boeing is building a brand new 747 Air Force One for future presidents, but costs are out of control, more than $4 billion. Cancel order!
— Donald J. Trump (@realDonaldTrump) December 6, 2016
Trump summoned the Boeing CEO, Dennis Muilenburg, to his Mar-a-Lago resort in Florida, telling reporters that he was trying hard to get costs down. Muilenburg said as he left the resort: “We’re going to get it done for less than that, and we’re committed to working together to make sure that happens. I was able to give the president-elect my personal commitment on behalf of the Boeing company.”
Trump also hit out at Lockheed Martin over the cost of the next generation of F-35 fighter jets, tweeting last month:
The F-35 program and cost is out of control. Billions of dollars can and will be saved on military (and other) purchases after January 20th.
— Donald J. Trump (@realDonaldTrump) December 12, 2016
Again, the tweet wiped billions off Lockheed’s market value.
Trump expanded on his tweet on the Today show: “The planes are too expensive and we’re going to get the prices down, and if we don’t get the prices down we’re not going to order them.” He summoned Lockheed’s CEO, Marillyn Hewson, to the Florida resort.
“I had a productive meeting with President-elect Trump,” Hewson said afterwards. “I appreciated the opportunity to discuss the importance of the F-35 programme and the progress we’ve made in bringing the costs down. The F-35 is a critical programme to our national security, and I conveyed our continued commitment to delivering an affordable aircraft to our US military and our allies.”
Perhaps unsatisfied with the reaction, Trump announced on Twitter that he had asked Boeing to give him a quote on a different fighter jet option, the F-18 Super Hornet.
The decision will also have an impact on the UK, which has been chosen as a possible location for an F-35 maintenance site. Britain’s £6.2bn aircraft carrier programme is designed for use by jump jets such as the F-35.