The tweets are working. Ford cancelled plans to open a new plant in Mexico and, in what are seen as related moves, Fiat Chrysler announced on 8 January that it is to spend $1 billion to boost US manufacturing, with Toyota saying it will invest a $10 billion in the US over the next five years. GM challenged President Trump’s tweet threatening a “big border tax” on grounds of factual inaccuracy, but has also announced that it will invest $1 billion in US plants over several years.
Prior to these auto Twitter attacks, Trump had, in similar fashion, already caused US air conditioner and furnace-maker Carrier to make a U-turn on Mexican investment. And at his inaugural ball he asked the audience: “Should I keep the twitter going or not?.... Keep it going? I think so. I think so..... It’s a way of bypassing dishonest media, right?”
During his first week in the White House, the new president started on his plans to, as he sees it, boost the American economy by tearing up a trade deal and financially encouraging US firms to invest in the country and not move work offshore.
It is fascinating to observe. Having just reported on a somewhat lower-key reshoring initiative in this country (ReshoreUK – https://is.gd/afivag), and having followed the US reshoring initiative driven by former president of machine tool maker GF AgieCharmilles (now GF Machining Solutions) Harry Moser for many years, it is incredible to see how some big decisions have, apparently, been affected so quickly. Moser is getting behind Trump, incidentally (https://is.gd/efugej).
The Economist argues that the US president’s efforts work against the efficiency gains offered by free trade, which sees all countries get richer by specialising and trading, although the same magazine also admits that globalisation built on the current approach has left many behind, hence, to a large extent, Trump, Brexit and continental European political disquiet.
The USA and UK situations share a similar genesis and both President Trump and Prime Minister Theresa May say they will act to help those bypassed and threatened by globalisation. But the UK’s talk of trade deals is diametrically opposed to Trump’s direction of travel, although the latter does want an agreement with the UK (the USA is already the UK’s largest export destination by country for manufactured goods, as it happens). Real Brexit is two years away, so Trump’s actions will hog the limelight.
New language, tactics and politics. Reshoring just got seriously political.
This article was published in the February 2017 issue of Machinery magazine.
