Southfield, Michigan: Before Ford Motor Co abruptly cancelled a factory in Mexico criticised by President-elect Donald Trump, the foundation was poured, some of the steel beams were up, and parts makers were already lined up to supply the plant.
The automaker is working now on a plan to compensate those manufacturers and return the land to its owner, the government of Mexico, said Joe Hinrichs, Ford’s president of the Americas. The company intends to eventually disclose the construction cost of the aborted project, he said.
“It’s not an easy decision to cancel a plant that you’ve already started,” Hinrichs said after a speech at Automotive News World Congress in Detroit. “We don’t take it lightly. It was a big decision to build the plant in the first place and it was a big decision to cancel it.”
Ford told Mexico’s government of its intent to scrap the $1.6 billion (Dh5.8 billion) small-car factory on the morning of January 3, just before making the decision public. The Dearborn, Michigan-based company now plans to build Focus compacts at its existing plant in Hermosillo, Mexico. Executives made the decision when they saw sales projections for the car were lower than anticipated, Hinrichs said.
“We stayed true to our commitment to the Focus programme to make it in Mexico,” he said.
Ford is attempting to make peace with Trump after the US president-elect made the company a frequent target of criticism on the campaign trail. The second-largest US automaker cancelled the factory last week and said it will add 700 jobs to a plant in Flat Rock, Michigan. Trump tweeted his praise and turned his ire toward General Motors Co and Toyota Motor Corp for building cars south of the border.
“Ford just announced that they stopped plans for a $1 billion plant in Mexico and they’re going to be moving into Michigan and expanding very substantially an existing plant,” Trump said on Wednesday during his first formal press conference since the election. “I appreciate that from Ford. I hope that General Motors will be following, and I think they will be.”
Earlier today, GM spokesman Tony Cervone declined to discuss his company’s manufacturing investment plans, calling it a “complex business with a lot of inputs and considerations.” GM looks forward to “engaging the new administration in conversation”.
