General Motors Confirms It Will Invest Additional $1B in U.S.

WASHINGTON (Reuters) -
(AP Photo/Paul Sancya, File)

General Motors Corp. confirmed on Tuesday it would invest an additional $1 billion in its U.S. factories in 2017 and will move production of some parts from Mexico to the United States that was previously handled by a supplier.

The investments are in addition to the $2.9 billion the automaker announced last year, GM said.

GM and other automakers have been sharply criticized by U.S. President-elect Donald Trump for building vehicles in Mexico that are imported into the United States. Trump will be sworn in on Friday.

GM said the $1 billion investment will create or retain 1,500 jobs. The Detroit automaker said details of individual projects will be announced throughout the year.

GM also said it would begin work on bringing axle production for its next generation full-size pickup trucks, including work previously done in Mexico, to operations in Michigan, creating 450 U.S. jobs.

The part was previously built by American Axle & Manufacturing Holdings Inc. American Axle did not immediately respond to a request for comment.

GM spokeswoman Joanne Krell said the automaker planned to add 7,000 new U.S. jobs over the next two to three years. Krell said the decisions being announced “had been in the works for some time,” but she added that “the timing was good for us to share what we are doing.”

The 7,000 figure includes the 450 jobs on axle production, 1,500 jobs tied to the $1 billion announcement and more than 5,000 new jobs tied to engineering, GM financial and advanced technology.

GM shares rose in early trading up 0.7 percent or $0.26 per share to $37.60.

Trump, who made bringing back manufacturing to the United States a large part of his successful election campaign, did not directly mention GM on Tuesday but touted recent automaker investments in the United States.

“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 and with the massive cost reductions I have negotiated on military purchases and more, I believe the people are seeing ‘big stuff,'” he wrote in a pair of tweets.

Trump has been inaccurate in describing some U.S. auto investments, wrongly saying last week that Fiat Chrysler was planning to build a new factory in the United States. The company announced it is investing $1 billion in two existing plants, adding 2,000 jobs.

On Jan. 3 Trump threatened to impose a “big border tax” on GM for making some of its Chevrolet Cruze compacts in Mexico – and he has extended that threat to German automakers like BMW, AG and Toyota Motor Corp. over building vehicles abroad.

GM also said an unnamed supplier has committed to make components for GM’s next-generation full-size pick-up trucks in Michigan, moving 100 supplier jobs from Mexico to the United States.

But even as GM invests in U.S. plants, it has also been making job cuts. In recent months, the company announced plans to lay off about 3,300 employees at three factories. It said in November it would cut about 2,000 jobs when it ends the third shift at its Lordstown, Ohio, and Lansing, Michigan, plants in January. Last month it said it planned to cancel the second shift and cut nearly 1,300 jobs from its Detroit-Hamtramck assembly plant in March.

GM’s “general plan is to build where we sell and we’re focused on what we’re doing in the United States,” Chief Executive Mary Barra said in an interview with Reuters on Monday.

Barra, who said she planned to attend Trump’s inauguration, said GM wants to work with him, adding, “I do believe we have more in common than we have areas that we aren’t aligned.”