Trump must save GM's Lordstown, Ohio plant, or he might be the next to lose his job

[txradioguy]

Last July, President Donald Trump came to my hometown in Ohio. The Mahoning Valley, as it is known, is ground zero for what I refer to as the “Trump Democrat.”

The Youngstown-Warren area has been reliably blue for generations, fueled by the working-class union households who equated the Democratic Party with jobs and good wages. Over the years, the steel industry that once employed thousands of workers has disappeared. Tired of empty promises, these same Democrats were drawn to Donald Trump as someone who could finally help turn around our long-suffering community.

When President Trump visited Youngstown, he told to the crowd of 8,000 people that he noticed the skeletal remains of once occupied factories. “We’re going to fill up those factories or rip them down and build new ones,” he said. “After years and years of sending our jobs and wealth to other countries, we are finally standing up for our workers and for our companies…We never again will sacrifice Ohio jobs and those in other states to enrich other countries.”

The crowd cheered, bolstered with hope that President Trump would protect their jobs.

<snip>

My local community and its leaders have always banded together to show GM that Lordstown was up to the task of keeping a product or making a new one. They managed to hang on for 52 years, until this week, when the plant’s closing was announced.

The jobs Trump vowed to protect have vanished. I’m not suggesting that Trump caused the closure. Sales of the Chevy Cruze have been flagging for a while due to the growing SUV market share. 1,500 employees were laid off earlier this year. And Lordstown is not alone. GM will eliminate roughly 14,000 jobs between five plants in the U.S. and Canada next year.

But here is what is infuriating to me. General Motors continues to make the Chevy Cruze hatchback model in Mexico and has expanded its operations there to include new production of the Chevy Blazer. President Trump said he would not allow Ohio jobs to be sacrificed to enrich other countries, but that is exactly what is happening.

GM employs 5,600 people in Mexico to make the Chevy Cruze hatchback – basically the same car GM is taking away from Lordstown. The average wage of a Mexican worker in a GM plant is $3 per hour. Meanwhile, 1,600 Ohioans will lose jobs that pay roughly $24 per hour to an assembly line worker.

GM jobs built my community’s middle class by paying good wages and providing a strong benefits package. Lordstown families could afford to get their kids braces and send them to college. They could go out to dinner or the movies. They put money back into the local economy.

<snip>

Donald Trump won Trumbull County, which is home to the GM Lordstown plant. He was the first Republican to win this county in 88 years. I am from Trumbull County and represented it in the Ohio Senate for 10 years. I know from speaking to my neighbors and constituents that many of them voted for Trump because they expected him to help our economy.

Well, here is President Trump’s chance to help us.

Our local economy will collapse if Lordstown closes. The president needs to work with GM to move production of the Cruze from Mexico to Lordstown. In speaking with plant officials when I was in office, I learned it would take minimal investment to adapt the line at Lordstown to be able to make the hatchback Cruze that is currently being made in Mexico.

President Trump’s slogan on the campaign trail now is “Promises Kept.” I believe he wants to keep the promises he made to the people of the Mahoning Valley, and I think only the Trump White House can move this big of a mountain.

If Trump fails to help, Ohio may not blame him for GM closing its doors, but they will blame him for not saving the plant. If that happens, Trump may be the next to lose his job in 2020.

https://www.foxnews.com/opinion/ttrump-must-save-gms-lordstown-ohio-plant-or-he-might-be-the-next-to-lose-his-job

[Frank Cannon]

Eff this. Lordstown should have been shut down 10 years ago when Pontiac went under, but Obama pushed GM to build the Cruze that no one wanted.

[Applewood]

What about the other plants?  Can he save those jobs too? 

Trump is in a corner on this one.  He made promises he could not keep.  Until and unless industry is run by the state, the owners are free to do whatever they want.  And it seems to me that right now, GM at least does not feel it is not bound by the jobs promise Trump made to the voters.

[Fishrrman]

Sell the plant to one of the Japanese or Korean automakers.

They'll revive it.

Won't need no U.A.W., however...!

[EasyAce]

What about the other plants?  Can he save those jobs too? 

Trump is in a corner on this one.  He made promises he could not keep.  Until and unless industry is run by the state, the owners are free to do whatever they want.  And it seems to me that right now, GM at least does not feel it is not bound by the jobs promise Trump made to the voters.

Even though President Trump is talking tough over GM’s cuts, his policies are at least partly to blame for the lost jobs. Earlier this year, GM warned that Trump’s tariffs could force layoffs and cause increases in the price of cars. In September, GM announced that its 2018 material costs would increase by an estimated $1 billion due to tariffs as well as higher oil prices, inflation, and tighter supplies.

As with the higher cost of materials, there are a number of factors at play in the decision to close the plants and lay off workers. The plants being closed make sedans which are not selling well in the US as buyers choose more SUVs and trucks. Forbes also notes that the popularity of ridesharing services is driving a reduction in car ownership. A large supply of used cars has also contributed to a decline in new car sales.

The argument that GM’s cuts are purely due to poor sales of sedans misses an important point, however. The Wall Street Journal points out that China is GM’s largest market for small cars. After President Trump applied tariffs to Chinese imports, the Chinese government retaliated with a 40 percent tariff on imported American cars. If GM exports American-made cars to China they get hit with the double whammy of the US tariffs on imported steel and aluminum as well as the Chinese tariff on imported cars. That is a powerful incentive for the company to move small car production to China.

The entire episode is an example of the Law of Unintended Consequences. When President Trump launched his tariff policy to protect the American steel industry, it was entirely foreseeable that American companies that consume steel would suffer from higher steel prices.

---David Thornton, "Trump vs. General Motors," The Resurgent.

[Frank Cannon]

Even though President Trump is talking tough over GM’s cuts, his policies are at least partly to blame for the lost jobs. Earlier this year, GM warned that Trump’s tariffs could force layoffs and cause increases in the price of cars. In September, GM announced that its 2018 material costs would increase by an estimated $1 billion due to tariffs as well as higher oil prices, inflation, and tighter supplies.

GM has straight up said the tariffs had nothing to do with this restructuring.....

While GM, and other car companies, have spoken out against rising production costs caused by the Trump administration’s protectionist tariffs, a spokeswoman for the company told TheBlaze that the layoffs and plant closures “are being made as part of our ongoing transformation and are not related to recent trade or tariff decisions.”

On a conference call, GM CEO Mary Barra said that the company is “taking this action now while the company and the economy are strong to keep ahead of changing market conditions.”

https://www.theblaze.com/news/2018/11/27/trump-threatens-to-end-subsidies-to-gm-for-electric-cars-over-layoffs

Anyone following the car business knew this was coming 5 years ago.

[EasyAce]

GM has straight up said the tariffs had nothing to do with this restructuring.....

As if GM hasn't been wrong before, and on numerous occasions? (They only begin with the Vega, the X-Cars, the Chevette, the Cadillac Cimarron, Saturn, and the car that ultimately killed Pontiac---the Aztek, which proved that being a little ahead of your time, which is exactly what Pontiac was with that crossover, is useless when the product was so ugly it made the Edsel resemble a Lincoln Continental.)

"The argument that GM’s cuts are purely due to poor sales of sedans misses an important point, however. The Wall Street Journal points out that China is GM’s largest market for small cars. After President Trump applied tariffs to Chinese imports, the Chinese government retaliated with a 40 percent tariff on imported American cars. If GM exports American-made cars to China they get hit with the double whammy of the US tariffs on imported steel and aluminum as well as the Chinese tariff on imported cars. That is a powerful incentive for the company to move small car production to China.

"The entire episode is an example of the Law of Unintended Consequences. When President Trump launched his tariff policy to protect the American steel industry, it was entirely foreseeable that American companies that consume steel would suffer from higher steel prices. In the case of the auto industry, other problems are exacerbated by the trade war."

---David Thornton, "Trump vs. General Motors," The Resurgent.

[Frank Cannon]

As if GM hasn't been wrong before, and on numerous occasions? (They only begin with the Vega, the X-Cars, the Chevette, the Cadillac Cimarron, Saturn, and the car that ultimately killed Pontiac---the Aztek, which proved that being a little ahead of your time, which is exactly what Pontiac was with that crossover, is useless when the product was so ugly it made the Edsel resemble a Lincoln Continental.)

Chinese weren't buying our cars before this tariff. A) they are in a terrible economic state. B) they put massive regulations on buyings cars 3 or 4 years ago because of the smog problems and traffic jams. C) the Chinamen are taking most of the cars the US, Japan and Europe are building and cloning them so there is no need to buy anyone else's shit.



This Chinese car market saving the day has been a pipe dream for a decade for US car manufacturers. It's bullshit.

[EasyAce]

Chinese weren't buying our cars before this tariff.

Actually, they were. Among American-made vehicles they've been buying, according to LMC Automotive, which tracks such data among other data, are Chevrolet Camaros, BMW X-5s (made in South Carolina), Jeep Wranglers, Cherokees and Grand Cherokees, Lincoln Continentals (starting last year), MKCs, and Navigators, Tesla Models X and S, Toyota Siennas (made in Indiana), and Ford Explorers.

[txradioguy]

@EasyAce if I recall correctly there were a few people who tried to warn about the law of unintended consequences when these tariffs were announced. And that other nations wouldn't just sit there and take it with the tariffs we were implementing on them.

[EasyAce]

@EasyAce if I recall correctly there were a few people who tried to warn about the law of unintended consequences when these tariffs were announced. And that other nations wouldn't just sit there and take it with the tariffs we were implementing on them.

@txradioguy
More than a few people.

[Frank Cannon]

@EasyAce if I recall correctly there were a few people who tried to warn about the law of unintended consequences when these tariffs were announced. And that other nations wouldn't just sit there and take it with the tariffs we were implementing on them.

Well what are the unintended consequences because there is no evidence given by the pack of vehicle illiterate, leased Hyundai driving Trump haters that this GM restructuring has one thing to do with the tariffs. GM says it didn't. US vehicle sales in China don't show it. Nothing shows it.

[GrouchoTex]

Add the CAFE standards, which forces manufactures to make cars that keep an average MPG across their whole line.
If gas prices are reasonable, people have no inclination to buy smaller, more fuel efficient cars.
They will buy trucks, SUV's, larger vehicles.
Add to this, an aging population, which (like myself) find it easier to get in and out of trucks and SUV's that are not as low to the ground.

[EasyAce]

Add the CAFE standards, which forces manufactures to make cars that keep an average MPG across their whole line.
If gas prices are reasonable, people have no inclination to buy smaller, more fuel efficient cars.
They will buy trucks, SUV's, larger vehicles.
Add to this, an aging population, which (like myself) find it easier to get in and out of trucks and SUV's that are not as low to the ground.

I'm 6'4" and own a 2007 Toyota RAV4. It's one hell of a lot easier for me to get in and out of that than a small car. My friends still kid me that the only vehicle I could get into and out of comfortably without risk to my head is a bus, but never mind---though I do have the occasional fantasy about owning one of these, restored:





I once owned a small car---a 1987 Honda Civic---and it was the only small car I ever owned (I had a 1982 Civic which I traded in for the '97) that had the ideal headroom for me to get in and out without splitting my head open. I've since owned a Ford Crown Victoria (an '87 bought used in 1991; or, "pre-owned" as the politically correct phrasing goes: 30mpg highway), a Lincoln Town Car (an '87 bought uses in 1996 with low miles on it, 30 mpg highway), a Dodge Intrepid (new, 2006, and 32 mpg on the highway), and the RAV4 (bought it used with very low miles in 2014).

[LMAO]

Why do I have this feeling that we’re going to end up doing another bail out? When Obama was bragging about how he saved GM, I said the next president and the next president and the next president will be saying the same thing

[Wingnut]

Why do I have this feeling that we’re going to end up doing another bail out? When Obama was bragging about how he saved GM, I said the next president and the next president and the next president will be saying the same thing

Bailout?  WTF.  GM is swimming in cash.  Did you see their 3rd quarter earnings.

Right or wrong GM is protecting its share holders with this move.   

Now if you want to argue what is wrong with Capitalism  this would be a bullet point.

[Frank Cannon]

Bailout?  WTF.  GM is swimming in cash.  Did you see their 3rd quarter earnings.

Right or wrong GM is protecting its share holders with this move.   

Exactly. If GM would have made forward looking moves like this in the 2000's, like Ford did, they wouldn't have needed the bailout.

[GrouchoTex]

@EasyAce
I am driving the same Toyota Tacoma that I purchased new in 2006.

[EasyAce]

When Obama was bragging about how he saved GM . . .

Which His Excellency Al-Hashish Field Marshmallow Dr. Barack Obama Dada, COD, RIP, LSMFT, Would-Have-Been-Life President of the Republic Formerly Known as the United States, couldn't have done if outgoing President Lips II hadn't signed off on the bailout in the first place, in December 2008.

The bottom line, of course, is: lay down with the State's dog, wake up with the State's fleas pecking at you.

[EasyAce]

@EasyAce
I am driving the same Toyota Tacoma that I purchased new in 2006.

@GrouchoTex
I hope and pray I'll have enough wherewithal to trade my RAV4 in within a year for the new RAV4 . . .



I got to test drive one while having my incumbent serviced and believe me, it's a beauty in and out and a honey to drive.

[goatprairie]

@EasyAce if I recall correctly there were a few people who tried to warn about the law of unintended consequences when these tariffs were announced. And that other nations wouldn't just sit there and take it with the tariffs we were implementing on them.

What??!!! I thought Trumpanomics was immune to the laws of economics?? So what if tariffs are taxes on American businesses and by extension American consumers?  The Mighty Trump can do anything...he told us so.   

[EasyAce]

What??!!! I thought Trumpanomics was immune to the laws of economics?? So what if tariffs are taxes on American businesses and by extension American consumers?  The Mighty Trump can do anything...he told us so.   

@goatprairie

[Frank Cannon]

@GrouchoTex
I hope and pray I'll have enough wherewithal to trade my RAV4 in within a year for the new RAV4 . . .

Well if you are so worried about Lordstown shutting down you should get off your ass and trade that piece of shit in on a new Chevy Cruze. It isn't tariffs killing that plant. It's people like you who don't buy their products.

[truth_seeker]

Bailout?  WTF.  GM is swimming in cash.  Did you see their 3rd quarter earnings.

Right or wrong GM is protecting its share holders with this move.   

Now if you want to argue what is wrong with Capitalism  this would be a bullet point.

It appears the GM vehicle lines being abandoned, do not compete well with buyers (of similar lines, made in Japan, Korea, Germany, Italy, Britaain and/or by Ford, Dodge/Chrysler.


GM seems incapable, of handling the very same challenges, faced by all automakers.

This trend has been more or less continuous, since the 70s.

 

[EasyAce]

Well if you are so worried about Lordstown shutting down you should get off your ass and trade that piece of shit in on a new Chevy Cruze. It isn't tariffs killing that plant. It's people like you who don't buy their products.

Well, if they made what people wanted, no problem.

I buy what I damn well feel like buying and I don't give a damn who makes what I want if they make it well. I'm not exactly wealthy but I work hard for what I don't make and I want value for what I spend, whether it's one of the guitars I play or the car I drive or the appliances with which I cook and clean. (For the record, I own and play Gibson guitars. I cook with, among other things, a completely restored 1955 Sunbeam Mixmaster, All-Clad cookware, an LG oven, and a set of Global kitchen knives. I clean with an LG washing machine and an Aerus/Electrolux vacuum cleaner; Aerus took over the American Electrolux plants when Electrolux decided to pull out of the U.S. and they still make the cleaners the classic Electrolux way.)

My own take is that the tariff issue is only part of the automakers' dilemna. You couldn't pay me enough to have a Chevrolet anything (unless it's a completely restored 1958 Impala without the hot-rod crap), never mind the Cruze, a car you'd need the jaws of life to get me into and out of, anyway. But then my ideal American car died a long time ago; you only see them now at car restoration clubs and they're a lit-tle out of my wallet range . . .