Trump Tweet Is The New Nightmare For Auto CEOs.
But Toyota Blast Got The Facts Wrong.
The new nightmare for automotive CEOs is the sudden arrival of the Trump tweet which could throw a monkey wrench into expensive investment plans, and attract the spotlight of unfavourable publicity.
GM and Ford have been on the receiving end of Trump Tweets about their plans to make cars in Mexico. Aerospace players Lockheed Martin and Boeing have also been embarrassed. Ford said it would stop building a plant in Mexico. Fiat Chrysler announced a $1 billion investment in U.S. production that could have gone to Mexico.
But Toyota’s involvement was perhaps the most harrowing so far. Its Trump Tweet arrived in the middle of the night – “Toyota Motor said will build a new plant in Baja, Mexico, to build Corolla cars for U.S. NO WAY! Build plant in U.S. or pay big border tax.”
Toyota’s problem was that Trump’s facts were wrong. The bad media publicity was in full swing though, so how do you tell the president-elect of the U.S. that he has his facts wrong?
Toyota has been building vehicles in Baja for 14 years. Trump apparently was referring to a new plant Toyota has planned in Guanajuato, central Mexico for 2019 which will replace Corollas made in Canada. All production for U.S. sales remains in Toyota’s Mississippi factory.
Toyota said that production volume or employment in the U.S. wouldn’t decrease as a result of its Guanajuato plant. It said it had invested $22 billion in the U.S. building 10 factories and employing 136,000 people.
No word yet on what happened to the Trump operative who fed this embarrassing wrong information to the president-elect.
Meanwhile BMW, Nissan, Honda, and Audi which also have plants in Mexico, must be eyeing their twitter feeds nervously.
But after the Toyota debacle, perhaps the tweets will stop. As Reuters Breaking Views columnist Antony Currie put it –
“Toyota’s day in Donald Trump’s crosshair could mark peak Twitter-Trump”.