Ford cancels Mexico factory and invests in Michigan – and announces plan after Trump tells Chevy to build in America or ‘pay big border tax’

Ford Motor Co. said Tuesday it was scrapping plans to build a $1.6-billion factory in Mexico and would invest $700 million to expand a Michigan plant to build electric and autonomous vehicles that will add 700 jobs there in a move Ford’s chief executive said was a “vote of confidence” in the economic policies of President-elect Donald Trump.

Ford isn’t abandoning expanded production in Mexico. The company said that to “improve company profitability” it would build its next-generation Ford Focus at an existing plant in Hermosillo, Mexico.

But in the wake of criticism by President-elect Donald Trump of the U.S. automaker and other companies moving manufacturing jobs across the border, Ford said it would cancel its plans for a major new plant in San Luis Potosi, Mexico.

A company news release didn’t mention Trump, but Chief Executive Mark Fields told CNN on Tuesday that the new plans were “a vote of confidence” in the direction of the U.S. economy under the president-elect.

“We didn’t cut a deal with Trump. We did it for our business,” Fields told CNN. The company spoke with Trump and Vice President-elect Mike Pence about the news earlier Tuesday.

A few hours before Ford’s announcement, Trump complained via Twitter that General Motors Corp. was selling Chevrolet Cruze vehicles made in Mexico tax-free in the U.S.

“Make in U.S.A. or pay big border tax!” Trump tweeted.

GM responded that nearly all the Chevy Cruze vehicles sold in the U.S. are made here.

“All Chevrolet Cruze sedans sold in the U.S. are built in GM’s assembly plant in Lordstown, Ohio,” the company said. “GM builds the Chevrolet Cruze hatchback for global markets in Mexico, with a small number sold in the U.S.”

Ford’s announcement didn’t appear to be related to Trump’s tweet, as the company outlined detailed plans for 13 new electric vehicles it plans to introduce in the next five years. The moves are part of a $4.5-billion investment in electric vehicles by 2020.

The $700-million expansion of Ford’s Flat Rock Assembly Plant in Flat Rock, Mich., over the next four years will enable the factory to make a new “small utility vehicle with extended battery range” as well as “fully autonomous” vehicles for ride-hailing services, Ford said. It said the plant will also make the Ford Mustang and Lincoln Continental.

Shifting Focus production to Hermasillo, Mexico, from Wayne, Mich., will enable that U.S. plant to make products that will safeguard 3,500 jobs, Ford said.

Shortly after Trump was elected in November, he tweeted that Ford had decided to keep a Lincoln plant in Kentucky rather than move it to Mexico. Ford said it had decided to keep producing a small Lincoln utility vehicle at its Louisville Assembly Plant and had not intended to move all its production from its Kentucky facilities.

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