Ford Makes Unwise Move In Shifting 300-Mile Electric SUV Production To Mexico?

DEC 9 2017 BY C SMITH 122

Ford has announced that Michigan will no longer be the production site for its upcoming 300-mile electric SUV. A new site has been chosen. Mexico it is.

Citing lower labor costs that will help the company be more competitive with other automakers, Automotive News says Ford has decided to shift production of its as-yet unnamed electric crossover to Mexico. The EV was originally slated to be built at the company’s large facility in Flat Rock, Michigan, bringing an additional 700 jobs to the plant.

The Ford Escape Energi Plug-In Hybrid Out Testing In June 2017/

In a memo obtained by Automotive News, Ford allegedly said the shift will “bring this exciting new vehicle to global customers in a more effective way to support our overreaching business goals.”

Part of those goals include a fully autonomous vehicle that was to be built alongside the new EV, a project Ford says will now receive an additional $200 million and 150 new jobs as a result of the move south of the border. That investment – along with production – will remain in Michigan.

Both the electric crossover and the autonomous vehicle were announced earlier this year. The CUV is expected to have a range exceeding 300 miles and be affordable to mainstream buyers, a factor which seems to have played a significant role in the company’s decision to move production to Mexico. Ford also expects the vehicle to be a low-volume model, adding additional hurdles to production costs. Meanwhile, the fully autonomous vehicle is said to be a commercial hybrid designed for delivery and ride-hailing use.

Ford is playing catch-up to other automakers in the electric and autonomous realms. Whereas fully electric cars have been available from many mainstream manufacturers such as General Motors for several years, Ford’s proposed crossover will be its first proper all-electric passenger vehicle. After replacing former CEO Mark Fields earlier this year, Ford’s new boss Jim Hackett has implemented new strategies in hopes of jump-starting the company towards widespread electric and autonomous development.

The unnamed electric crossover is expected to appear in 2020, with the autonomous commercial hybrid vehicle planned for 2021.

Source: Automotive News

Categories: Ford

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122 Comments on "Ford Makes Unwise Move In Shifting 300-Mile Electric SUV Production To Mexico?"

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Man,I am just so tired of reading about how Trump’s America first rants are helping keep/create US jobs… Are you tired of “winning” yet?

My understanding….

Most of these EVs will go to Europe. MUCH bigger tax (tariff) advantage to manufacture and ship from Mexico to Europe than from US to Europe. Cheaper labor cost is also a secondary factor.

This is a big part of the ‘bad trade deals’ that Trump is (or, at least says he is) trying to re-negotiate.

Trade deals? There are no Trump trade deals. He just walks away from them without dealing and our competitors jump in and take advantage. So far he’s alienated all of our allies and trading partners with nary a discouraging word against Putin. Strange.

Exactly right!

The 6th round of NAFTA re-negotiations is scheduled for the end of January 2018.

he walks away from the terrible deals the failed Obozo made. That is a good thing.

“The goal of NAFTA was to eliminate barriers to trade and investment between the U.S., Canada and Mexico. The implementation of NAFTA on January 1, 1994 brought the immediate elimination of tariffs on more than one-half of Mexico’s exports to the U.S. and more than one-third of U.S. exports to Mexico.”

Your ignorance is staggering!

Why would Mexico have lower tariffs into EU/Europe than does America?

I think that it is the same.

Ok, here you go. (wouldn’t want you to wear yourself out with a two minute google search)

… and in case it’s too tough to read the link:

Made in Mexico vs made in USA export to europe, $25,000 car:

Labor savings: $600
Tariff savings: $2500

So far both Mexico and Canada have refused to sign new trade deals with the US, but yeah, blame Trump if that fits your narrative.

Ford will get a 20% tax rate for making cars in Mexico. Trump is just easy to blame but i do agree, he’s there for decoration purposes only.

Ford Makes Unwise Move In Shifting 500km Electric SUV Production To Mexico?

Why is this an “Unwise Move”

“So much winning, you’ll get sick and tired of it…”

Yeah, I’m still waiting for that to happen.
But the sycophants keep drinking the Kool-Aid, you can’t convince them that it isn’t already in full effect.

I wonder if this is what it looked like in the 1930’s

Translation: Now that we can repatriate profits back into the United States without any tax penalty, there is no longer any reason at all to keep anything in the United States.

Not an issue with Mexico because of North American Free Trade Agreement.

You’re right about repatriation not being a factor here, but a lower corporate tax rate does reward the use of cheap foreign labor.

Corporate tax is like a penalty for not reinvesting. If you put all your net profits back into your business (new hires, new equipment, R&D, etc), you pay no corporate tax. Reduce this penalty and it becomes more attractive to take profit instead of reinvesting.

And with the repatriation deal, it’s better for corporations to keep their profits offshore and wait for the GOP to give them a huge tax break every 15 years or so, much less than the domestic rate.

if you know nothing about businesses and taxes, why comment?

What part did he get wrong? That corporations will take the tax break and have bigger profits? Sounds pretty accurate to me.

The main problem with this tax plan is that it does not impose any restrictions on the way the businesses can use the additional money. They should make it mandatory that the extra money they make to be invested in the US economy. They don’t get to build in China with out tax money! Lower the rate to 20% for US corporations and make the rate 40% for internationals and the ones like Ford that constantly outsort.

Sadly, both Trump and CONgress have done taxes all wrong esp. if they want to bring manufacturing/business back.

Best way would have been dropping all deductions/exemptions/breaks for both corporate/personal.

WRT Corporate, simply tax at 25% anything that is NOT 80+% American-made goods/services or sales. IOW, for 80% American-made item, it is free for corporate tax. Likewise, if a retail store sells 80% American-made goods, they pay no corporate taxes.

Wrt personal taxes, simply put all money obtained (gains, dividends,wages, salaries, lottery, inheritence, etc) on a single progressive tax scale that starts at 1% above poverty, and tops out at say 25%.

Since this past January, I wonder how many employees in the U.S. have had to provide training to their overseas replacements.

Trump is trying to change NAFTA. If you guys have a beef it’s with FORD and previous presidents. Obama (and Hillary) did nothing to “keep/create US jobs”.

What an insane comment.
LOL. You actually think Democrats are anti-job.
After Obama cleaned up the criminal Wall Street Fraud recession and achieved 8 YEARS of JOB Growth.

Are you 80?

Democrats hate America.

Republicans hate everybody, including themselves.

Almost true. They love their bosses, the ones paying their real salaries…the big businesses.

The failed Obozo and the Democrats/Socialists doubled the national debt, put more people on food stamps than in the history of the program, oversaw more jobs going out of America than ever in history, got more people dependent on government welfare than ever before, gave us the failed Obozocare, etc…

I hate both parties equally…well maybe the reps a bit more…but I’m not sure what you are suggesting here. Should have Obama left everything in the crapper like it was and not try to rescue the economy after the disaster the dems and reps caused through a decade of deregulation? The deficit was created due to the efforts of putting the economy back on track. If you don’t remember how bad it was then you are just a foreign troll that has no business commenting on US policy.

Trump loves the working class so much that he supports a tax plan that raises taxes on taxpayers making less than $75k. He’s also a deficit hawk, which is why that tax plan he supports will increase the debt by over $1 TRILLION over ten years. When will you ever learn?

They will not. Never.

Don’t forget they constantly say the Government Underestimates the US inflation rate.
And what do they do, the CHANGE the Inflation formula for Social Security to UNDER-Estimate it.

Kicking his White Social Security Truthers in the brass b0lls.
But, they’ll never hear it on Fox.

“1 trillion over 10 years” ahh, yeeeeeaaah, you do know, that Obama raised our national debt by over a trillion every year he was in office. He was by far, the worst President ever on all things related to budget…or lack there of.
I don’t know where you get 75k from…
Bottom line, your taxes will either stay the same, or go down, not up.
You’re welcome.

Dear God,
Thank you for revealing what the future holds for us.

If the current tax plan will only raise the debt by a trillion dollars in 10 yrs, then I guess the Trump administration won’t be doing unforcasted spending anywhere else. (i.e. start a new war, compensate for an eventual market meltdown, resupplying FEMA… you know, stuff that happens every few years or so)

Thus, the Almighty has just declared that the next ten years will be absolutely boring, and everything will happen just as He planned.

For nothing, idiot! I already did the math and my taxes are going up. I make good money so I don’t mind that much but i fail to see how a multinational corporation deserves a huge cut just to open China factories and stash money in the Caimans. Feel free to explain…

Corporations don’t pay taxes, consumers do. Think before you say more stupid things.

“Automakers Ford and GM, despite $20 billion and $9 billion in net income, respectively, paid a scant $270 million and $570 million in taxes — simply because they have billions in previous-year losses to balance against recent profits.)”…Forbes

Are you for real, dude?!

Presidents propose budgets but the House determines the spending and revenue. W’s final budget was $1.2 trillion in deficit.

Merv, your statement about the impact of the short term personal income tax reduction simply isn’t true. But given the disingenuous way the media has framed the headlines about the tax bill, it isn’t surprising that you don’t understand how it will work. The NYT and Forbes, those bastions of conservative thought, have emphasized that 15% to 20% of the people making between $86,000 and $300,000 will see their taxes go up, BUT the rest will see it go down or remain the same. Of households earning under $30k, only 3% will see their taxes go up, 36% will see their taxes go down. But these people seldom pay much in income taxes to start with. Of people earning $30k to $50, only 15% will see their taxes go up, 57% will see their taxes go down. And for middle income people earning between $50k and $75k just 17% will see their taxes go up while a whopping 73% will see their taxes go down. Almost every bracket will see the taxes they pay go down by about 1.4%. But since the people in the top tax paying quintile pay 80% of the income taxes, they are going to get… Read more »

The numbers I quote come from the NYT, by the way. Google it and it is the top article, but you have to read the whole thing to get the real numbers.

the gullible puppets believe whatever the fake news tells them

Fool Cells, who’s side are you on? I think the NYT will slant the news to help the left 98% of the time. Kind of similar to how media tax info shows that they donate 98% of their campaign donations to Dems. Oddly enough, it is coming out now that the top FBI agency bigwigs are donating around 95% of their campaign donations to the Dems as well. Kind of makes the Mueller/Comey/McCabe/Strzok partisan attacks make sense. The FBI and the IRS have been weaponized by the left and that seems to be ok with the media, because they are on the same team.
“They aren’t biased if I agree with their positions! Then it is simply common sense!” LOL!

Fool Cells, I just saw your previous posts, I guess I can figure out who’s side you are on. LOL! I couldn’t tell who you thought were the gullible ones until I saw your other posts.

He was talking about himself…

Ziv, Corp and pass-through rates are this tax bill’s favors, not the chumps making hundreds of thousands, in salary. It’s the 1%, not the “quintile”, that materially make out.

It matters little “up or down”, because it’s not much more than optics. Lowering the corp rate to 20% costs about 100 billion, for each 1% it fell from 35%. That (and dynamic, Laffer scoring) is most of our newest deficit ADD, of 1.5 trillion.

leeches need to start paying taxes. Everyone should pay taxes.

15% for everyone and everything without any deductions and loopholes. I support that.

The biggest tax cheats are the wealthy.

O did more to start companies as well as keep companies in America.
It has been the GOP that has shipped them off-shore. For example,no taxes until profits repatriated has done more damage to American jobs than anything else.

Also why build electric cars in a state that Ford backs the dealers in fighting an electric car manufacturer already.

PS. Joshua is right, why can’t America keep its jobs.

US has to compete in a global marketplace; all car manufacturers distribute production over many countries.

Of course, but when:
A) the EV charge is led by American-built Teslas
B) half the appeal of EVs is due to sustainability and using local electricity instead of foreign oil
C) EV buyers are willing to pay more for their cars
D) the simple EV drivetrain needs less labor

then it really reflects poorly on Ford, and they’ll pay for it in sales.

Agree Mint — if Tesla can do it in CA –ANYONE can do it in the US

They just need the willpower to do it.
But shipping jobs overseas gives a quick near-term boost to profits.

Good points, Mint. I like to use All American electricity to power my Volt, not Jihadi Juice. Oil is a fungible good, any purchase of it drives up global demand, which in turn drives up the price. So by driving down the demand for oil by driving an electric car, we are making it harder for Putin, the House of Saud and the little dictators in Venezuela to stick it to their people. Lets impoverish Putin by building demand for electric cars up to 10% of the US Light Duty Fleet by 2022! I would love to see it happen sooner.

Eveytime I drive my Leaf I feel good about not sending money to the House of Saud.

I agree with you, Hugh! But the amazing thing is that it is POSSIBLE, not probable, but possible, that MBS is actually going to open up the government of Saudi Arabia. He is going to let women drive, and for women to be outside the home without a male escort. He has already banned the religious police from the streets where they used to beat women for wearing “immodest” clothing and young men for wearing western garb.
If he leads SA away from the Wahabi fundamentalist and ushers in a more humane strain of Islam, he and his father could change the path of both Saudi Arabia and, to a lesser extent, the Islamic faith in general.
Yeah, not likely, but it could happen.
Many Muslims are sick of being the religion of murderers, almost as sick as they are of being the religion most synonymous with backwardness.
The question is whether the reformers will gain the critical mass needed to bring the murderers and their supporters to heal. Not likely, but possible.

esp since we bailed their ass out in the GOP great recession. And yes, they took a MAJOR no-interest loan that is STILL not paid off.

Why care about workers at all? If EVs are ceaper built in Mexico, build them there!

The same with Tesla and unions. Why spend more on lowly educated workers? If they are too stupid to get a job with enough demand, they deserve performance reviews that end their job.

“ the company be more competitive..”
America would be more competitive world wide if we had national health care like other countries.

Rich Repubs wouldn’t have any fun not watching you go bankrupt, lose your job and sell your house at a loss, if we had national healthcare. See all the chances they have to make money at your disaster?

As one of those “rich repubs” you guys love to hate, I’ll make you a deal on single payer. When the political & Hollywood elites (Jimmy Kimmel, Hillary, Chucky Schumer, etc) all agree that they will outlaw any and all private healthcare so that everyone will be required to use the single payer system with no exceptions, then I’ll support it.

That of course will never happen because they only want crappy single payer for the masses, primarily so they can control one more element of our lives. None of them will ever use the single payer system, so it’s easy to support it.

I know you’re being sarcastic, but what I don’t think you understand is that 95% of Americans would take that deal. You make it sound like Single Payer is concentration camp Nazi stuff, but for anybody at the lower end of the spectrum struggling to get by – let alone pay the outrageous cost of “healthcare” – it sounds like a pretty good deal.

Amen! preach it brother.

I have good insurance through my job but would take the single. There is no reason in a civilized country for anyone to go bankrupt due to medical issues. You enjoy your benefits for now but don’t forget, the dems made impossible for the insurance companies to drop you in case of disease…for now.

+ infinity

I’d switch in a heartbeat if it were offered here.

You can have private insurance with single payer, you pay premiums to both, the private is supplemental.

no we wouldn’t. Where do you gullible, low informaion puppets come up with this stupid stuff? Government run anything is a complete disaster. People work for the government because they are too stupid to make it in the private sector.

Medicare is run for much less than private health insurance. When you have to take more off the top for huge salaries, bonuses and dividends, less goes to health care.

FORD = Factory Outsourcing (is) Really Dire

UAW and the Chicago TPT workers, like Jacoby Hennings, at the Woodhaven stamping plant, RIP.

Sometimes it’s they only want to move out of Michigan to another state, but have to move out of the US to get out of UAW’s influence. The generational workforce’s entitlement mindset in Michigan is entrenched and concrete. Not collaborative but combative.

‘The Duhnald’ will not be happy about this. Will he now have to keep NAFTA? Oh, its all so much more confusing, and hard, to lead a country rather, than just tweet and rile up the gullible.

Ford wants your money
Ford doesn’t want to give you jobs
Don’t buy ford.

Vote with your wallet.

All large manufacturers spread production around many countries. Most of the value in a Bolt comes from other countries, mostly Korea.

GM spent good money on local production of the Volt. Only problem for me, they never came out with a wagon version to fix the rear seat headroom issue.

That’s still a problem.

Buy a Japanese care to send all the profits out of the country.

“CUV range exceeding 300 miles and be affordable to mainstream buyers”x”Ford also expects the vehicle to be a low-volume model”


If they spend minimum development money, they already know it won’t do well in the market.

And what do we call it when a company plans to introduce an EV that they don’t think people will want..?

You’re going to blame apresident Trump because Ford Moves a production line to Mexico? Discusting. Maybe you should blame the unions.



Found the rich Republican.
Always crying about working class guys getting a decent pay check.

A friend from school who owns a small business, and is a dyed in the wool Republican admits to me that if he could legally pay his employees less, he would; but the Minimum Wage prevents him from doing so. And yes, he is a proud Trump supporter.

Funny thing, he often complaints about the high turnover in his company, and the profits lost training new employees. (It’s a light industrial assembly plant)

Not really blaming, but sarcastically pointing out that he was going to put a stop to this. Like he was going to give us a healthcare plan where “everybody will be covered, at a fraction of the cost.” Also the hypocrisy of blaming Obama when a company outsources under his admin, but somehow it’s a different standard under a white guy. God Blesh the Unasha Shtesh.

It’s irrelevant what he says. He’s a player and tells people what they want to hear so he gets his way. He’s the ultimate politician.

Well, he takes the credit when they stay. Should he not take the blame when they leave?

My guess is he wont ever admit to any fault.

Germany has strong unions, they do well.

Why is it unwise?
The vast majority of sales will be outside of US.

Exactly. Besides a lot of consumer electronics like big screen TVs sold in the US are already made in Mexico, and Mexico itself is a big market.

Why do you say that?

Plugin market in US some 15.000/month. WW >100.000/month.

Like I said in the California bill to ban sales of gas cars, what we see here is the influence of 30 years of well-funded right-wing propaganda.

This process has led to ideologically inbred people who no longer can think for themselves but rather just excrete what they hear on Breitbart, Faux News, etc and vote for people like Trump or Roy Moore and their race to the bottom.

I for one will vote for my wallet

I vote that you’re a dimwit.

Go back to Breitbart you clueless RWNJ.


I’ll second that

An electric Ford Escape with 300 mile EPA rated range at an “affordable” price is monumental. It should have a profound impact on mainstream EV adoption.

IMO – In the grand scheme of things, does it matter if Ford manufactures the vehicle in Mexico to keep the costs down? If it’s between the USA being offered this EV at an affordable price vs. keeping 550 manufacturing jobs in the USA, I choose EVs succeeding. The economic benefit for the USA will be far greater than 550 jobs. How many $billions are shipped every day to middle eastern countries in the form of oil revenues and our military costs securing these oil resources? Congress just passed a $700 billion military budget for this year, up from $549 billion. This is not sustainable.

Rich, as I conservative, I agree that increases of that magnitude are not sustainable. I think we should scale back ALL federal spending and balance our budget.

To put your comment in perspective, the 2017 budget that called for $543 Billion in Defense spending also called for a total of $2.36 TRILLION in spending on Social Security, Medicare, Medicaid, Unemployment, and Labor.

We don’t have a Defense spending problem, we have a SPENDING problem.

Dear ROTP,
What you won’t spend on social programs, will be spent twice on police, prisons, insurance, and charity.

Exhibit A: fentanyl crisis.
Exhibit B: US incarceration rate.
Exhibit C: cost of basic security… guns, gated communities.

May I suggest you visit another developped country for ideas.

I still don’t get why the US military budget is as high as the 12 next nations together. Are the aliens about to attack?

…then again, God hasn’t chosen my nation, so I wouldn’t understand.

A perplexed Non-American.

It’s hard to explain this to fellow Americans that don’t travel and live under rocks. Fools like the one above you believe in cutting ss just to fat up the defense contactors pigs.

“we have a SPENDING problem”

I agree. $20 Trillion in debt puts the US in a fiscally perilous position and I would like to see a balanced budget as well. However, I was more focused on EV benefits.

IMO – Mass EV adoption by our nation should result in positive financial benefits at many levels. Here’s a few supporting the point I was going for.

1) 70% reduction in vehicle fuel costs for every vehicle owning family in the USA. This should be a huge financial booster to our economy. Taking a SWAG at this, it would result in an average family savings of ~$1,500/yr for life. That’s a lot of money going back into our economy instead of being shipped overseas.
2) 90% reduction in maintenance costs. Again, a decent savings per family going back into the economy.
2) Reduction in our Military costs, which is one piece of the puzzle to a balanced budget.
3) Allows for the USA to achieve energy independence, greatly improving our nation’s security and the trade deficit
4) Predictable energy costs

Etc. I have a full page of points.

We spend more on defense then the next SEVEN countries combined. Yes, we have a defense spending problem.

Social Security was paid by employees and employers. If the government had not taken the money and put bonds in the “trust” fund it would still be there.

I wonder how many of these pro-corporate/anti-union posted were typed via a phone, tablet, or computer made in China? 😉

As many as those posting left-wing nonsense.

Look, a new (right-winger) username breitbart zombie troll has appeared to pollute this thread since they have no real interest in the topic of EVs.

No doubt summoned from the depths of hell whence all these hypocritical losers come from.

Aren’t you missing out on your local KKK meeting or something equally repugnant to go to there in Idaho?


“Ford is playing catch-up to other automakers in the electric and autonomous realms. Whereas fully electric cars have been available from many mainstream manufacturers such as General Motors for several years, Ford’s proposed crossover will be its first proper all-electric passenger vehicle.”
Not sure I totally agree w/this narrative. Ford was selling plug-ins in 2012, well before many of those joining the party now. And they were selling 3 different models in 2013, well before anyone else.

I think instead of saying “catch-up”, as if they are behind in technology, I’d say they are wading into the pool deeper than just their ankles.

IMHO — There are incentives available for relocating even a planned plant (i.e. Carrier) — my bet is Ford will put it in the US but just said they are putting it in Mexico to get some Government $$$$..

If labor costs are causing Ford to move EV production out of the US, why don’t they move all production outside the US?

Mexican minimum wage just rose to $4.70 A DAY. Companies might be worried Mexicans make a habit of periodically raising their minimum wage.

Let’s hedge, and keep some production in the US.

Hedging at x20 the cost of the investment…now that’s refreshing!

No need for that. They can always move to States that greedy Unions haven’t reached yet.

…and pay as little as Mexico does. Hopefully you are in one and make that. Cheers!

A race to the bottom for third world status.

Ford people are looking pretty stupid to me. When was the last time Ford did a survey and asked customers how they feel about having cars built in Mexico? No, they never did and one of the most important things to me is where a car is built.I would buy just about any electric car before I would buy a car not built in Canada or the U.S.A

Maybe you didn’t read what you are commenting on..? They aren’t built for the US market.

If you think consumers in Europe would rather help create US jobs than Mexican ones, you are deluded.

Ford has built the Fusion there for years, American buyers have bought lots of those.

This article fails to explain its title. How is Ford’s move unwise?

I think the office furniture salesman running Ford may not understand there is a deeper connection with consumers with their cars than with their office furniture. Where it’s made and who makes it matters. Why not just have the Mustang made in Mexico as well. Then there is the cost rationale… VW and Ford have already stated that EVs are cheaper to develop, cheaper to manufacture, cheaper to distribute and cheaper to sell….so why move the most cost-effective model to Mexico and keep the most expensive to develop, manufacture, distribute and sell where labor is more expensive as well. Also, I think it’s the ‘industry’ that so obsessed with self-driving cars and self-driving car sharing, while actual consumers are asking for $30k 300+ mile EVs that actually look like they cost $30k. But instead, in an effort to slow EV adoption, Ford and GM still offer $30k+ EVs in body styles of sub-$20k sub-compacts or compacts. Which is why neither Ford nor GM have anything on my list for ICE replacement EV purchase. Currently, the Model 3 is clearly the only viable option for a 200 – 300+ mile EV. I can’t wait for Tesla to get production going full… Read more »