US president-elect Donald Trump launched his latest Twitter missive over Mexico-built and imported cars toward a Japanese automaker for the first time, threatening to tax Toyota Motor Corp into building a plant in the US instead.
Days removed from Ford Motor Co canceling a US$1.6 billion plant in Mexico, Trump seized on a 20-month-old announcement by Toyota of a factory scheduled to build Corolla compacts beginning in 2019. After misstating that the new plant will be built where Toyota already has a production site, Trump followed with “NO WAY! Build plant in US or pay big border tax.”
Trump’s attacks on the auto industry are in keeping with his pledges to revive US manufacturing that has steadily migrated to countries with cheaper labor for decades. He targeted General Motors Co earlier this week for building a version of its Cruze compact south of the border, and Ford’s move on Tuesday after months of criticism closely followed a decision by United Technologies Corp’s Carrier in November last year.
The offensive against Mexico by Trump is reverberating oceans away weeks before he takes office. Nissan Motor Co, Toyota’s biggest Japanese peer and the top auto producer in Mexico, is fine with the president-elect’s “America first” stance, chief executive officer Carlos Ghosn said in an interview.
“I’m hearing ‘We in the US have a very large market, and we want our fair share of the benefits both in terms of trade and jobs,’” Ghosn said on Thursday from the CES 2017 trade show in Las Vegas. “I’m not hearing ‘close the border.’”
Toyota builds Corollas from a factory in Mississippi and had produced more than 500,000 units as of early 2015. The automaker broke ground last month on a plant in Apaseo el Grande, Guanajuato, will add capacity for the model without leading to decreased production or employment in the US, according to a statement released after Trump’s tweet.
“With more than US$21.9 billion direct investment in the US, 10 manufacturing facilities, 1,500 dealerships and 136,000 employees, Toyota looks forward to collaborating with the Trump Administration to serve in the best interests of consumers and the automotive industry,” the company said in a statement on its Web site.
Toyota already has a factory in Mexico’s Baja California state that borders the US, making Tacoma pickups. Trump incorrectly stated in his tweet that the Corolla plant would be built in Baja.
Toyota shares fell as much as 3.1 percent in early Tokyo trading, the biggest intraday decline in two months.
Hours before Trump’s tweet, Toyota president Akio Toyoda said he would take the president-elect’s decisions into account when planning the automaker’s Mexico operations, in response to a question about Ford scrapping its factory.
The grandson of Toyota’s founder told reporters at a New Year’s event he is always thinking about boosting US production, regardless of the political situation in the country.
Toyota and Nissan are among nine automakers that have announced more than US$24 billion in investments in Mexico since 2010, lured by its cheap labor and free-trade agreements with the US and more than 40 other countries.
The press office of Mexico’s economy ministry, which handles trade and foreign direct investment issues, declined to comment.
ISSUES: Gogoro has been struggling with ballooning losses and was recently embroiled in alleged subsidy fraud, using Chinese-made components instead of locally made parts Gogoro Inc (睿能創意), the nation’s biggest electric scooter maker, yesterday said that its chairman and CEO Horace Luke (陸學森) has resigned amid chronic losses and probes into the company’s alleged involvement in subsidy fraud. The board of directors nominated Reuntex Group (潤泰集團) general counsel Tamon Tseng (曾夢達) as the company’s new chairman, Gogoro said in a statement. Ruentex is Gogoro’s biggest stakeholder. Gogoro Taiwan general manager Henry Chiang (姜家煒) is to serve as acting CEO during the interim period, the statement said. Luke’s departure came as a bombshell yesterday. As a company founder, he has played a key role in pushing for the
China has claimed a breakthrough in developing homegrown chipmaking equipment, an important step in overcoming US sanctions designed to thwart Beijing’s semiconductor goals. State-linked organizations are advised to use a new laser-based immersion lithography machine with a resolution of 65 nanometers or better, the Chinese Ministry of Industry and Information Technology (MIIT) said in an announcement this month. Although the note does not specify the supplier, the spec marks a significant step up from the previous most advanced indigenous equipment — developed by Shanghai Micro Electronics Equipment Group Co (SMEE, 上海微電子) — which stood at about 90 nanometers. MIIT’s claimed advances last
CROSS-STRAIT TENSIONS: The US company could switch orders from TSMC to alternative suppliers, but that would lower chip quality, CEO Jensen Huang said Nvidia Corp CEO Jensen Huang (黃仁勳), whose products have become the hottest commodity in the technology world, on Wednesday said that the scramble for a limited amount of supply has frustrated some customers and raised tensions. “The demand on it is so great, and everyone wants to be first and everyone wants to be most,” he told the audience at a Goldman Sachs Group Inc technology conference in San Francisco. “We probably have more emotional customers today. Deservedly so. It’s tense. We’re trying to do the best we can.” Huang’s company is experiencing strong demand for its latest generation of chips, called
GLOBAL ECONOMY: Policymakers have a choice of a small 25 basis-point cut or a bold cut of 50 basis points, which would help the labor market, but might reignite inflation The US Federal Reserve is gearing up to announce its first interest rate cut in more than four years on Wednesday, with policymakers expected to debate how big a move to make less than two months before the US presidential election. Senior officials at the US central bank including Fed Chairman Jerome Powell have in recent weeks indicated that a rate cut is coming this month, as inflation eases toward the bank’s long-term target of two percent, and the labor market continues to cool. The Fed, which has a dual mandate from the US Congress to act independently to ensure