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GM to invest $1 billion in U.S. factories and create or keep 7,000 jobs here

General Motors chief Mary Barra, shown Jan. 10, has said her company has no plans to change where it produces small cars due to threats from President-elect Donald Trump.
(Paul Sancya / Associated Press)

General Motors Co. plans to invest $1 billion in U.S. factories and add thousands of new white-collar jobs, measures that have been in the works for years but were announced Tuesday after criticism from President-elect Donald Trump.

In all, the Detroit automaker said it will create or keep 7,000 jobs in the next few years, including about 2,000 at factories. An additional 5,000 positions will be created at its auto financing arm and to develop advanced technology, electric and autonomous vehicles and information technology.

Trump has demanded that the auto industry build more cars in the U.S. GM said the actions announced Tuesday have been in the works since well before the election, although spokesman Patrick Morrissey acknowledged that it’s a good time to announce new jobs in the U.S. Trump will be sworn in Friday as the nation’s 45th president.

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“There’s no question there is an emphasis on job creation in the U.S. right now,” Morrissey said. “This is good timing for us to share what we are doing.”

He said most of the new positions would be in Michigan, with exact locations to be revealed later. The long-planned new white-collar jobs are to come in the next two or three years.

GM said the factory investment will create or keep around 1,500 jobs at unspecified factories. In addition, 450 pickup-truck axle-making jobs will be moved to Michigan from Mexico. GM also said an unidentified company that will make parts for the next-generation pickups will move 100 jobs to Michigan from Mexico.

Trump has attacked GM and other automakers for building vehicles in Mexico and shipping them to the U.S. He has threatened to impose a 35% border tax on automotive imports from Mexico.

Ford Motor Co., Hyundai Motor Co. and Fiat Chrysler Automobiles U.S. have also recently announced large investments in their U.S. operations and the creation of new jobs. It’s a pattern of auto companies making routine jobs announcements to head off criticism from Trump, who made keeping U.S. factory jobs a key element of his campaign.

“General Motors’ announcement today is mostly theater to play in the news cycle created by President-elect Trump’s tweets,” said Michelle Krebs, an auto industry analyst for Kelley Blue Book. “These investments and hiring plans have long been in the works.”

Still, Trump claimed credit Tuesday for bringing auto jobs to the nation. “With all of the jobs I am bringing back into the U.S. (even before taking office), with all of the new auto plants coming back into our country I believe the people are seeing ‘big stuff,’” he said on Twitter.

His tweet was only partially true. No automaker has announced plans to build a new U.S. factory in recent years, but jobs have been added at existing plants.

On the eve of the Detroit auto show last week, GM Chief Executive Mary Barra said the company has no plans to change where it produces small cars in light of Trump’s threats. Trump threatened GM with a tax for importing some Chevrolet Cruze hatchback compact cars from Mexico. Most Cruzes sold in the U.S. are sedans built in Ohio.

GM said it has invested more than $21 billion in the U.S. and created 25,000 jobs — 19,000 white-collar and 6,000 blue-collar positions — since it left bankruptcy protection in 2009.

Earlier Tuesday, Hyundai said it will significantly increase its investment in the U.S. while Trump is president and is considering building a new U.S. factory. It didn’t provide further details and denied that political pressure was behind its announcement of a $3.1-billion U.S. investment plan by 2021.

Ford announced this month that it had scrapped plans to build a $1.6-billion small-car factory in Mexico, and Fiat Chrysler announced a $1-billion investment plan in its two U.S. factories.

Although Ford announced plans for 700 new jobs in Michigan, it still plans to build the compact Ford Focus in Mexico, but at an existing factory. Jobs at the plant that now builds the Focus in suburban Detroit will remain because the plant will build a new SUV and small pickup truck.

Fiat Chrysler’s job announcements were part of a plan announced last year to get out of the small- and midsize-car business and shift production to trucks and SUVs, including a new Jeep pickup.

Nearly all automakers build small cars in Mexico to take advantage of its lower wages to offset lower prices and profit margins on the cars.

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UPDATES:

3:40 p.m.: This article was updated with additional details of GM’s announcement, reaction from President-elect Donald Trump, context and analyst comment.

This article was originally published at 6:45 a.m.


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