Ford Motor Co. (NYSE:F) on Tuesday abandoned its plan to build a car factory in Mexico and added 700 jobs in Michigan. The announcement follows Donald Trump’s criticism on General Motors (NYSE:GM) over compact cars manufactured in Mexico. Trump recently tweeted that ‘’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!”
The second biggest U.S automaker will no longer pursue plans it disclosed in April to invest $1.6 billion to build the new facility in San Luis Potosi, Mexico, a project which faced heavy criticism from Trump during the election campaign and he even called it an “absolute disgrace.”
Ford reported that it would spend $700 million to expand the Flat Rock, Michigan plant and would manufacture new electric, hybrid and autonomous vehicles there. Union workers at the Flat Rock praised the latest move. Hiring of the 700 new employees is expected to start in 2018.
Senior executives at Ford personally informed Trump about their latest decision. The company’s chief executive officer, Mark Fields admired tax and regulatory proposals promoted by Trump and his fellow Republicans.
Ford will make a battery electric SUV with a driving range of 300-mile at the Michigan facility by 2020. It will also commence production of a completely autonomous car there by 2021. The company also plans new hybrid models of its F-150 pickup truck, Mustang and police cars by 2020.
Shares of Ford Motor Co. (NYSE:F) jumped 3.79 percent to $12.59 in the last trading session. The 52-week range of the stock is $11.02-$14.22. The company’s market cap is $49.62 billion and P/E ratio of 6.27. The stock is up more than 1 percent in the pre-market session on Wednesday.