Trump's Toyota tweet sees his threats extend beyond US firms

In this instance, it's actually Canada who should be upset...

Trump's Toyota tweet sees his threats extend beyond US firms

Picture by Gerry Broome AP/Press Association Images

Toyota has become the latest company to be on the end of a Donald Trump Twitter lashing, as US President-elect slammed the Japanese car manufacturer’s plans to build a new plant in Mexico. 

His threat to impose a “big border tax” on Corollas imported into the US if the factory is constructed south of the Rio Grande echoed tweets directed at the likes of General Motors and Boeing, but marked the first time he laid down a black-and-white ultimatum to a company that does have its roots in America.

Toyota lost $1.5 billion in value in the five minutes after the tweet.

It responded that it contributes nearly $22 billion to the US economy and employs 136,000 people in the country.

The company said it looks forward to collaborating with the Trump administration to “serve in the best interests of consumers and the automotive industry".

In truth, the New York mogul need not have worried. As announced in 2015, the $1 billion Corolla-making plant is expected to open in 2019 and will be replacing Toyota's plant in Ontario, rather than the US factory in Mississippi.

As Business Insider also points out, the plant will be in Guanajuato rather than Baja. The latter already has a Toyota plant, which has been making Tacoma pick-ups since 2002.

Toyota joins an ever-expanding list of companies that have raised Trump's ire on social media. General Motors was also threatened with a "big border tax" if it sent its "Mexican made model of Chevy Cruze" into the US. he opined in December that Amazon's "stock would crash and it would crumble like a paper bag" if it "ever had to pay fair taxes. Lockhead Martin Corp and Boeing were accused of demanding "out of control" costs for a brand new 747 Air Force One with the closer: "Finish order!"

Giant retail chain Macy's was called out as "disloyal", T-Mobile's service described as "terrible" and Indiana bearing and gears maker Rexnord was attacked for moving to Mexico.

On the flipside, Trump has been full of praise for Ford this week after it announced that it was cancelling plans for a new $1.6bn plant in Mexico. Its next-gen Focus will instead by made at an existing plant in Hermosillo, Mexico, to improve profitability, with an investment of $700m and 700 direct new jobs also pledged to its Flat Rock facility in Michigan. expansion of its facility in Flat Rock, Michigan.

But Ford says it will build its next-generation 'Focus' at an existing plant in Hermosillo, Mexico "to improve company profitability".

The common denominator with the above is that they have been US firms. Today's stand against Toyota expands Trump's protectionist policy to include foreign businesses with US interests.

Japan responds

Japanese officials and business leaders rushed to highlight the benefits the automotive manufacturer's US ties provides. 

Finance minister Taro Aso said:

"Toyota is responsible for large employment at US plants such as in Kentucky. It’s questionable whether the new US president has a grasp of how many vehicles Toyota builds in the US."

CEOs of companies such as Sony and Nissan also weighed in., hoping to nip any widespread deterioration of Japan-US trade in the bud. 

Toyota's full statement reads:

"Toyota has been part of the cultural fabric in the US for nearly 60 years. Production volume or employment in the US will not decrease as a result of our new plant in Guanajuato, Mexico, announced in April 2015. With more than $21.9 billion direct investment in the US, 10 manufacturing facilities, 1,500 dealerships and 136,000 employees, Toyota looks forward to collaborating with the Trump administration to serve in the best interests of consumers and the automotive industry.

"In 2015, Toyota exported more than 160,000 US-built vehicles to 40 countries, helping to establish the US as a global export hub.

"Our manufacturing facilities in Baja, Mexico, established in 2002, support production at our San Antonio, Texas, plant, where 3,300 team members produced over 230,000 Tundras and Tacomas in 2016.

"Recent manufacturing expansions by Toyota in the US include:

  • $360 million investment in Toyota's Georgetown, Kentucky, plant, adding 750 new jobs
  • $150 million investment at its Huntsville, Alabama, plant
  • $100 million investment in Toyota's Princeton, Indiana, plant, adding 300 jobs
  • $90 million investment at its Buffalo, West Virginia, plant, adding 80 jobs"