U.S. President-elect Donald Trump threatened to impose a ''big border tax'' on General Motors. Ford nixed plans in Mexico under pressure from Trump. Fred Katayama reports.
President-elect Donald Trump threatened to slap a "big border tax" on General Motors for making some its Chevrolet Cruze hatchbacks in Mexico. Trump tweeted, "General Motors is sending Mexican made model of Chevy Cruze to U.S. car dealers-tax free across border. Make in U.S.A. or pay big border tax!" GM made about 50,000 Cruzes in Mexico last year, according to Automotive News. In comparison, it built more than 300,000 of them in the United States. Michelle Krebs of Autotrader. (SOUNDBITE VIA SKYPE) MICHELLE KREBS, SENIOR ANALYST, AUTOTRADER, (ENGLISH) SAYING: "They haven't been selling well, even though that car has gotten great reviews, and it was recently redesigned. They've recently cut back a shift there. The hatchback is a very small percentage of that. So, I don't know if it would be ultimately worth it to move it back to the U.S." GM responded, saying "All Chevrolet Cruze sedans sold in the U.S. are built in GM's assembly plant in Lordstown, Ohio. GM builds the Chevrolet Cruze hatchback for global markets in Mexico, with a small number sold in the U.S." James Nolt of World Policy Insitute says companies in other sectors are getting ready for changes. (SOUNDBITE) JAMES NOLT, SENIOR ANALYST, SENIOR FELLOW, WORLD POLICY INSTITUTE & ADJUNCT PROFESSOR, NEW YORK UNIVERSITY, (ENGLISH) SAYING: "I've already read that Apple, for example, has done a contingency study to see how much it would cost if they moved manufacturing back from China to the United States. Other companies are probably doing the same sort of thing. They're making contingency plans. What if Trump is really serious about this? How could it affect our costs?" Hours after Trump's GM tweet, Ford said it's canceling plans to build a $1.6 billion factory in Mexico and investing $700 million in a factory in Michigan. The move comes after Trump's criticism of its Mexican investment plans.