Thursday, July 09, 2015

Donald Trump is correct Ford is buiding engine and transmission plants in Mexico.

What Donald Trump stated is that this plant was for cars sold in the US. 

We enable (click here) our plants and facilities around the world to produce world-class products for customers everywhere. We ensure flawless and efficient vehicle assembly and the design and installation of the production tooling that makes it possible.

I am not surprised former President Calderon won't talk to Mr. Trump. This is the thing, we have witnessed the loss of jobs in the USA because of outsourcing. Will there be good paying jobs lost in the US because of this plant? If this is a new facility in Mexico while American jobs are static or even increasing because of this plant, then there isn't much to complain about. 

The sincere way of protecting American jobs is to grow the Middle Class in other countries. When there is a global Middle Class the economic markets will be incredibly successful. However, the Middle Class of one society may have very different product demands due to a difference in culture. Does Wall Street understand what steps are required to bring about a strong Middle Class in all countries? I am not sure they do.

 

Production Supervisor (Process Coach - Production)

 

Engineering Specialist - Controls

 

Controls Engineer

 

Global Labor Optimization Industrial Engineer 

Above are the job openings at Ford for Americans. There are currently 98 openings. All are skilled jobs that require college degrees, except, for the Production Supervisor. The Production Supervisor position(s) can be filed with High School graduates, but, they need to have years of experience with Ford or a similar company. There are better paying jobs to those on the assembly line that can be filled by those assembly line workers. None of these jobs are manufacturing positions in an assembly plant. Supervisors are not direct manufacturing jobs. 

The Mexico plant looks like a 'ground to car' manufacturing plant. They are pouring hot metal into engine block molds and transmission parts to build engines and transmissions out the door to assembly plants in the USA. I am assuming these important drive train components will be shipped to the USA for assembly.

Good paying jobs are vital to a global economy that will thrive and grow. The USA has sacrificed dearly while Wall Street outsourced jobs. The idea behind investments in other countries is that the manufacturing will raise citizens out of poverty and into a position to participate in a growing economy, not a subsistence economy.

Up to this point the majority of outsourced jobs put huge profits in the pockets of stockholders and CEOs. CEOs have been rewarded with enormous bonuses to do exactly what they did to the US Middle Class. Those actions by a company have caused stemmed growth relying only on population growth and even then there weren't people within the reach of their products.

The jobs in Mexico is vital to that economy. Of that I have no doubt. But, will the jobs result in increased demand for products from the USA? Will people in Mexico be purchasing cars assembled in the USA? Or will these jobs dissipate into an internal economy that will never benefit the USA trade gap?

To raise people out of poverty is a difficult thing and for Wall Street to seek to grow by building stronger Middle Classes in countries around the globe is an achievement all by itself. But, we don't want another failed company. Are the CEOs looking at the whole picture. Does a CEO see a quick bonus at any cost, or is the CEO growing a community globally that actually sell more product and increase company profits permanently. It is the CEO that increases profits through long term planning that will be the one best receiving the bonus and only a bonus reflecting the increased profit structure for the company.

This is Ford. Ford has been a company with long range plans. They were the 'last man standing' in 2008 because they were looking toward long term goals when they borrowed money while at zero percent interest. These monies were not needed, but, with a zero percent interest the investment was made to fill the treasury to over flowing. These plants are probably a direct result of that long term strategy. 

I have no way to know if Ford did their homework to sustain jobs in the USA at current levels while making investments in foreign countries. I have no doubt this decision to build engines and transmissions in Mexico is due to NAFTA. I hope Ford is also building a safe plant with environmental concerns both inside and out to protect lives. Knowing Ford that is not an option. I do not believe Ford will build plants anywhere that imperil lives. So, in this instance I'd have confidence in realizing these jobs in Mexico will translate into growth. 

That should be the real goal of Wall Street. Their growth needs to be real and continuing and sustainable to add more and more foreign markets to bring about a Middle Class. Sacrificing the Middle Class in the USA is not a reflection of a sustainable company.

I wish Ford good will to understand the USA will not be hurt by this investment, but, will find opportunity to expand markets and bring down the USA's trade deficit. In many ways if this is a Ford we have come to call our own, we can be confident in the decision to build these plants. We look forward to greater demand of USA products because of Ford's investment today.

April 17, 2015 
Mexico City 

Further building (click here) its lineup of increasingly fuel-efficient engines and transmissions, Ford today announced a $2.5 billion investment in two new facilities building a new generation of engines and transmissions in the states of Chihuahua and Guanjuato, respectively.

The investment, which comes during the celebration of Ford’s 90th anniversary in the country, will bring 3,800 direct new jobs plus additional indirect jobs to Mexico. Ford officials announced the investment today during a ceremony with Mexican President Enrique Peña Nieto and other members of the country’s Federal Government.

“Ford is making a significant commitment to our business in Mexico with investment in two new facilities, while aiming to make our vehicles even more fuel-efficient with a new generation of engines and transmissions our team in Mexico will build,” said Joe Hinrichs, Ford’s President of The Americas. “These new engines and transmissions will help deliver even better driving experiences and fuel economy gains for customers around the world.”...

Let me state this as well. I would be far more confident regarding this investment by Ford if the Mexican government is open to Union representation of their employees. A Union will bring the work force condition to the table and insure a better quality of life that lends itself to increased of foreign trade. The Mexican government has to work to defeat corruption which can be rampant in the country. 

I would hope the Mexican government can also provide a strong secure environment that won't destroy a company because of drug cartels.