By on January 17, 2017

GM: Barra at 2016 GM Annual Stockholders Meeting

Not wanting to be left out of the flurry of recent U.S. investment announcements from various automakers, General Motors arrived at the party with cash in hand and second thoughts about Mexico.

GM says it will invest an extra $1 billion in its U.S. operations, with the cash covering several new vehicle projects, as well as some advanced technologies and components initiatives. The funding comes hot on the heels of similar announcements from Ford, Fiat Chrysler Automobiles and, just this morning, Hyundai/Kia.

In a nod to the political climate in America, GM will shuffle some outsourced parts production back to U.S. soil.

A billion dollars isn’t a huge amount when contrasted with the $21 billion ponied up by GM since 2009, but a union would say that every bit counts. Also, symbolism breeds emotional capital. Part of GM’s plan includes returning axle production for its next-generation full-size pickups to U.S. soil, creating 450 jobs in the process.

A second supplier tapped for the next-gen trucks will create a further 100 jobs by manufacturing its components in Michigan. Overall, GM expects the cash injection to create or save 1,500 jobs (it won’t break down the numbers).

“The U.S. is our home market and we are committed to growth that is good for our employees, dealers, and suppliers and supports our continued effort to drive shareholder value,” said GM Chairman and CEO Mary Barra in a statement.

Automakers in all jurisdictions seem eager to placate President-elect Trump, who has promised a tariff on vehicles imported from Mexico.

Recently, Ford scrapped plans to build a $1.6 billion Mexican small car plant — likely because it wasn’t worth the expenditure — and offered up $700 million to modernize its Flat Rock, Michigan plant. For its part, FCA began the New Year by promising $1 billion to two assembly plants, including the Warren facility chosen for the upcoming Jeep Wagoneer and Grand Wagoneer. That investment was needed, as FCA had nowhere to build the big-profit Jeeps.

[Image: General Motors]

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64 Comments on “GM Brings $1 Billion to the Make America(n Manufacturing) Great Again Party, Recalls Axle Work from Mexico...”


  • avatar
    highdesertcat

    Heh, heh, heh…. GM needs to invest $10B of the bailout money back into the US, and then some.

    • 0 avatar
      Hoon Goon

      Mt thoughts as well.

    • 0 avatar

      $11B is what we lost in that deal, which appears to have been spent supporting manufacturing in 36 other countries.

      They sure didn’t spend it expanding manufacturing in the US.

      • 0 avatar
        bts

        Will any of these investments allow the US to increase their exports though? Or are all these planned capacity increases only meant to meet American shopping demands?

        • 0 avatar
          highdesertcat

          They’re only for American shopping demands. No one else wants to buy American-brand cars.

          The Chinese like Cadillac and Buick, but what do they know? They like German and Italian cars even more!

          Yesterday, the German automakers spoke with one voice after having been tweet-baited by Trump and the Germans replied that America should make better cars if they want to export them to Germany.

          Kinda says it all, in 140 characters or less.

          • 0 avatar
            bts

            One of the major goals for the American companies and what I believe Trump’s policy is lacking is actually producing exports.

          • 0 avatar
            snakebit

            I saw that comment from German carmakers, too. Boy, if ever we should take that advice for ourselves, that’s it. Oh wait, we do make better cars in America. Honda’s, Toyota’s, Subaru’s, Hyundai’s, and they’re even cars that many Americans like.

          • 0 avatar
            highdesertcat

            snakebit, problem is that those brands you mentioned are primarily for domestic-USA consumption.

            It’s unlikely that Chevies will ever displace Volkswagens on European highways and byways.

      • 0 avatar
        bd2

        Sure they did – haven’t you followed the news at all the past 8 years?

  • avatar
    Arthur Dailey

    After years of telling governments what to do, it looks like automakers are having their bluff called?

    For all those previous politicians who went ‘cap in hand’ begging for jobs and investments from the automakers, it seems that they took the wrong approach.

    • 0 avatar
      highdesertcat

      But who knew that Trump was such a union man!? Bringing all these jobs back to America means that the unions will harass and torture employers to let them set up union shops.

      Que Richard Trump ka.

      • 0 avatar
        Arthur Dailey

        Without the threat of unionization what would prevent the corporations from making these minimum wage jobs?

        With the existing surplus of labour in the USA based on our assumptions about those who have withdrawn from the workforce, the existence of a large ‘illegal’ workforce who probably will not be expelled and the possibility of a ‘temporary foreign worker’ program like we had in Canada, the law of supply and demand regarding labour no longer exists in balance.

        • 0 avatar
          highdesertcat

          “Without the threat of unionization what would prevent the corporations from making these minimum wage jobs?”

          Nothing!

          But that’s what drove these jobs to cheaper labor markets in the first place — union demands!

          This whole “bringing back jobs to America” is a shell game. Many of the lost jobs were already filled by robots, and many more current and future jobs will be displaced by robots.

          But it’s lots of fun to watch as it unfolds before us car-industry buffs, even though we all understand that America lacks qualified workers and that robotics is the wave of the future for many of these blue-collar AND white-collar US auto-industry jobs.

          • 0 avatar
            bd2

            Only reason why GM is able to build the subcompact Sonic here is due to the Tier-2 workers (who get paid significantly less).

            But auto-makers all around the world have learned to cut labor costs – in Toyota City, there are masses of temp workers who do the same work that permanent Toyota employees used to do for much cheaper.

        • 0 avatar
          DearS

          The fact that most are underpaid in the world and probably the U.S. is another area that needs “balance”.

          Capitalism is imbalanced by default IMO.

          • 0 avatar
            highdesertcat

            “Capitalism is imbalanced by default IMO.”

            That is absolutely correct! Always has been that way, and always will be that way.

            And while it is generally true that “the more effort you put into your work, the more you get out of it”, it is also equally true that many individuals have tried and tried again only to have failed again and again.

            There really is such a thing as winners and losers at life, and sometimes winners are determined by “luck”.

          • 0 avatar
            bd2

            Imbalance is found EVERYwhere – whether it be the US, Australia, Germany, England, Israel, Mexico, Russia, China, South Korea or North Korea.

            The wealthy/elite make sure the rules benefit themselves – which is why we see basically the same level of disparity in wealth pretty much everywhere (and the disparity is only increasing).

    • 0 avatar
      OzCop

      I tend to agree Arthur. It is about time US automakers got their respective acts together…Sometimes it takes a businessman to deal with businessmen…

  • avatar
    NoID

    The way ah see it, y’either send them jobs overseas to shore up their home economies and keep those dirty farners away, or you keep them jobs within our borders and attract more farners.

    We’re darn’t if we do, and darn’t if we don’t.

    Welcome to the global economy, Trump.

  • avatar
    28-Cars-Later

    What’s so hilarious is all it took was someone in power to run his mouth on Twitter of all things and the Corporatocracy just falls in line. Change we can believe in!

  • avatar
    gtemnykh

    I’m optimistic about all of this. Definitely an unorthodox approach, but if Twitter rants and finger wagging is what it takes to change the overall attitude of the industry to prioritize setting shop back up in the US, I’m all for it. The companies are falling over themselves for the PR moment and to not be the odd man out, perhaps another Trump ‘4-D chess’ media manipulation move. If he wants to go for the ‘big fish,’ I’d love to see GM’s half ton crew cabs get called out for Mexican assembly. Frankly I don’t see why Ford and Toyota don’t do the job for him by advertising the fact.

  • avatar
    carguy

    Most of the recent announcements are just existing plans re-packaged. I don’t think we have seen any significant changes yet.

    • 0 avatar
      psarhjinian

      +1 on this. As with Carrier, Ford’s announcement (which had been planned many months prior, long before Trump’s win) this is really just coincidence and prior art repackaged as public relations.

      This isn’t like Reagan’s negotiating with Iran during Carter’s actual tenure; it’s just coattail-riding.

      • 0 avatar
        LeMansteve

        psarhjinian – I agree, but who is riding whose coattails? Trump or the Manufacturers? An argument could be made for either side.

        Trump gives himself credit for recent US manufacturing investments (that have likely been in the works for a very long time)

        or

        Manufacturers re-package press release to align with high profile President-Elect’s ideals and ride the high PR wave of inauguration week

        • 0 avatar
          psarhjinian

          I would say it’s both. Trump and his team, and the various heads of industry, know how to craft a business-as-usual announcement to their own benefit.

          You would either have to have nothing to lose and/or a very strong set of principles, to opt not to play the game.

      • 0 avatar
        gtemnykh

        Proof of the Carrier deal already being in place before Trump/Pence’s efforts?

      • 0 avatar
        bd2

        and nor only that, more public-financed corporate welfare.

        GM, Hyundai, BMW, VW, etc. have all had plans to expand production in the US for some time now, in particular, for more crossover production.

    • 0 avatar
      mtmmo

      Keep telling yourself that. Trump Derangement Syndrome is alive and well.

      MAGA!!

  • avatar
    PrincipalDan

    Patriotism is supporting your country all the time and your government when it deserves it. – Mark Twain

  • avatar
    OzCop

    I’m no twitter ranger, but if getting the word out, and not dealing with media being able to alter contextual intent as much, I’m all for it…Now, if he could just be a bit less brash in his responses to negativity his approval numbers may rise. On the other hand, he is a master at drawing attention, and the brash, often bordering on illiteracy, draws attention…good or bad.

  • avatar
    OldManPants

    Screw this politics crap; I just want to squeeze her beans.

  • avatar
    tylanner

    No company will defy this government when they talk a proverbial big stick. it wouldn’t make sense financially.

    But nearly everything Trump promotes is heavy handed, careless and narrowly focused.

    The simple thought that getting automaker jobs back in the US by any means necessary (a 35% tax would be debilitating and essentially force closures) is improving America displays his near perfect incompetence.

    These matters are not simple…one does not equal the other…it is an organic system of linkages that push and pull on each other in non- deterministic ways.

    • 0 avatar
      OldManPants

      “These matters are not simple…”

      No, but getting elected is when half the country is feeling death row and enough of the other half is so dismayed with the alternative party they’ll give Thump the von Papen chance.

      Oh, and simple misogyny.

      • 0 avatar
        28-Cars-Later

        Von Papen? Obscurity level assigned: 7.

        • 0 avatar
          Arthur Dailey

          A great if rather apocalyptic historical reference. For those who do not know: “It was largely von Papen, believing that Hitler could be controlled once he was in the government, who persuaded Hindenburg to appoint Hitler as Chancellor in a cabinet not under Nazi Party domination. However, Papen and his allies were quickly marginalized by Hitler and he left the government after the Night of the Long Knives, during which some of his confidantes were killed by the Nazis.”

          • 0 avatar
            OldManPants

            Way to go, Arthur!

            I’m Larry Bird and you’re Kevin McHale. I just whip it behind my back and you’re right there to put it in the basket.

            Sorry I don’t have a hockey analogy.

          • 0 avatar
            Arthur Dailey

            Mickey Mantle and Roger Maris? Larry Csonka and Jim Kiick?
            Ruth and Gehrig? Franco Harris and Rocky Bleier? Deadweight and BTSR?

            Take your pick, I am partial to any.

            Just as long as it isn’t Jack B and Bark M!

            And anyone could have scored off that set-up. In fact it and Twenty28’s comments about Mexico as a failed state ripe for another revolution were 2 brilliant pieces of analysis.

    • 0 avatar
      Higheriq

      I disagree – sometimes some things really ARE that simple. The problem is that too many people (such as yourself) think that they are too intelligent and therefor assume that nothing can be simple because EVERYTHING requires far more intelligent thinking. Much of the time, the answer is staring us right in the face.

  • avatar
    Jimal

    I didn’t vote for Trump, but as someone who watched his father’s world crumble around him as his GM career went away, and as someone who never understood what was in it for us with NAFTA, I have to say that these threats of retaliatory tariffs seems to be having some effect. Now I also have some respect for the likes of Toyota, who responded to Trump’s tweets by reminding him of how much they’ve invested in U.S. production over the years. It’ll be interesting to see how this all falls into place.

  • avatar
    sco

    I still dont quite get it. If american jobs are so important to americans then why are they not taking action on their own to demand american-made products. You dont need Trump or Obama or anybody to lead the parade (although it might help). And I would think that buyers of pick-ups, the most american of vehicles, would be leading the crusade. But pick-up buyers (just as an example) seem to be quite content buying vehicles sourced/assembled in other countries. It just puzzles me, and I’m not being sarcastic.

    • 0 avatar
      Spartan

      US citizens are collectively too naïve to understand the importance of supporting American made products today. I can understand why we didn’t years ago when American cars were garbage, but those days are over by far.

      Americans will buy a 5-Series or an E-Class made in Germany before buying a Cadillac CTS or a Lincoln Continental, despite the fact that in every day driving, these cars are on par with each other.

      FWIW, I own two American made cars. 2010 Taurus SHO and a 2016 Yukon XL Denali. I’ve owned foreign cars in the past (Honda, Infiniti, Jaguar, Volvo) but I’ll never buy another new foreign car.

      Visit other countries that manufacture cars. Koreans are driving Hyundai, Kia, SsangYong, and Renault/Samsung. Japanese are driving Toyota, Honda, Suzuki, etc. Don’t even get me started on Germany.

      We’re probably the only country with large car manufacturers that has a foreign made company hold the title of the best selling car.

      This isn’t to say that we should take a negative nationalistic view on things. That’s absolutely not what I am saying. I’ve traveled all over the world and I’ve seen American made cars in other countries that manufacture cars. They appreciate our cars, but they appreciate their own more for obvious reasons.

      The best selling cars in Korea, Japan and Germany are cars from those countries, as it should be. That should be the case in US, and it isn’t.

      • 0 avatar
        Arthur Dailey

        Whence the UK?
        In the 1950’s the largest exporter of automobiles in the world and home to a myriad of domestic automotive manufacturers.
        I personally would love an Alvis TE 21 convertible.

        • 0 avatar
          Mandalorian

          Problem with this is American cars have really only just recently caught up in terms of quality from the hole they were in for the longest time. I’m sure we all know someone or ourselves that got burned with a terrible American car at one point or another and swore them off. It takes time for the change in perception to set in.

          We’re still not quite out of the woods yet, imagine a guy who swore off American cars in the 70s and gets a Dodge Journey as a rental car, it’s really not enticing for him to want to hang up the import keys anytime soon.

          • 0 avatar
            highdesertcat

            “Problem with this is American cars have really only just recently caught up in terms of quality from the hole they were in for the longest time.”

            True, but the flip side is that transplants have sunk to the level of American cars ever since they started building them over here, with parts from the same American suppliers.

            As the owner of a Japan-built 1989 Camry V6 daily driver, I can tell you that they don’t make them like that any more.

          • 0 avatar
            Mandalorian

            I don’t know, I had a ’94 Pathfinder from new to 2002 and it was far from flawless. Traded it in for a Tahoe that was mechanically a great vehicle, but got it’s butt kicked six ways to Sunday in terms of interior refinement by a Sequoia. Flash forward to today and the new Tahoe/Suburban is leagues ahead of the Sequoia in these same areas.

    • 0 avatar
      Higheriq

      Because the “problem” with Americans is that we want it cheap, regardless of anything else.

  • avatar
    Frylock350

    I’m honestly impressed that the President-elect is making these things happen using just social media. I voted against him but I’ll recognize that he’s at least delivering on one promise.

    I personally think its more about overall investment in an economy and the balance of trade that matters. A company like Toyota does build and engineer plenty of products here. A company like Mercedes Benz is just an economic leech.

    • 0 avatar
      bikegoesbaa

      “A company like Mercedes Benz is just an economic leech.”

      The 4,000 people they employ in Alabama would probably disagree.

      Last I checked Alabama counted as part of America, 1861-1865 notwithstanding.

      • 0 avatar
        Frylock350

        Right so what’s the net gain with Mercedes? Does the trade in MB automobiles add or siphon money from the US economy? What percentage of MB products sold here are made here? How does that compare to General Motors, Ford, Honda, Toyota, etc? How many vehicles are designed here? They’re a leech. They take more from our economy than they contribute.

  • avatar
    DenverMike

    What a bunch of crap! GM needs to build all Chevy and GMC pickups in the US, not just a few selected parts. The profit margin on them is just insane, but still built in Mexico. It’s an insult to buyers to dumb to know any better.

    Hot dogs, apple pie and Hecho en Mexico???

  • avatar
    Higheriq

    Like him or not, and even before officially taking office, Trump seems to have made it “politically incorrect” for companies to send jobs out of the U.S., or at least announce that they are sending jobs out of the U.S. While it may or may not result in jobs actually returning, it is arguably a good start.

  • avatar
    Jagboi

    Personally, I think Trump is playing a dangerous game that may backfire. What happen if the EU decides to retaliate and place a 35% tax on Boeing airplanes for example? Or actually hold companies like Apple, Amazon and Starbucks liable for tax in the countries they do business instead of allowing shell holdings in tax havens?

    The USA has a lot to lose in a trade war, and not a lot to gain. You’re not going to see F150’s becoming the default vehicle in Germany for example. Much of the US domestic car production is unsellable in any volume outside of North America.

    • 0 avatar
      Spartan

      Agreed. We have a lot to lose in a trade war and I’m not sure our PEOTUS or his team has done the analysis to measure the potential impact on US companies abroad that will in turn, hurt those companies and their ability to hire here at home with reduced revenues from a trade war. We already see how the markets are reacting anytime Trump mentions a company in his tweets.

      Looking at this from a apolitical perspective, as I have no skin in the game per se, I don’t think this ends well based on the current strategy. However, based on his “art of the deal” strategy, he could be positioning the US to make better trade deals and this rhetoric is just that, rhetoric.

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