Ford write off its plans for a $1.6 billion Mexico plant in an announcement Tuesday.
The U.S. auto company said it will provide 700 direct new jobs in Flat Rock, transforming and expanding it to produce high tech electrified and autonomous vehicles, plus the Ford Mustang and Lincoln Continental.
Ford will build two products at a factory in Wayne, Michigan, where it assembles the Focus now, saving 3,500 jobs.
“Make no mistake about it — Ford is a global automaker but our home is right here in the United States,” Fields said at a press conference.
Reasons for the move
After getting bashed by president-elect Donald Trump accusing Ford of sending jobs outside of the U.S., Ford decided it will instead invest $700 million in Flat Rock, Michigan.
Ford Ceo Mark Fields announced that investment is a “vote of confidence” in the pro-business trend being led by Donald Trump and he assured that Ford did make any deals with him.
The move indicates Ford stepping back as it defended its production in Mexico even when Trump attacked the company for expanding there.
Trump even threatened Ford last year with higher taxes when it planned to move its Focus-model production to Mexico.
The U.S president also vowed to levy massive import taxes on cars built outside the U.S. as he blamed General Motors of shipping Mexican-made Chevy Cruzes to U.S. car dealers, tax free on Tuesday.
He said in a tweet that the largest U.S. automaker, which manufactures Cheverolet Cruze hatchback model in San Luis Potosi, should build the car at home or face hefty taxes. However GM has sold only 4,900 such hatchbacks north of the border, said spokesman Tony Cervone. The almost 200,000 Cruze sedans that Americans have bought were all built in a plant in Lordstown, Ohio.
The second largest U.S. automaker had announced its expansion in Mexico in April, saying it wants to improve profitability on its small cars which brought criticism from Trump at the time but now Ford say the decision to cancel is mainly because of weaker demand for small cars in the U.S., while electric cars and hybrids have the potential for growth and that the decision will have been made even without Trump.
Ford Executive Chairman Bill Ford called Trump this morning, hours before its announcement, informing him of the cancellation of constructing new plant in Mexico, which had begun in May. Fields said he discussed the new plan with Vice President-elect Mike Pence.
Trump has been taking credit for a series of announcements companies made like Carrier and Sprint which announced keeping jobs in the U.S. or creating new ones.
The next generation Focus compact car will be produced at an existing factory in Hermosillo, Mexico, and Ford will eradicate its plans to build a plant in San Luis Potosi.
Ford shares climbed 3.3 percent to $12.36 in New York while the Mexican peso dropped 0.9 percent against the dollar.