Published: Fri, November 30, 2018
Markets | By Otis Pena

Trump pushes penalties on foreign cars after GM announces layoffs

Trump pushes penalties on foreign cars after GM announces layoffs

It was the latest angry outburst from Trump who has frequently attacked U.S. companies that fail to fall in line behind his promises to protect USA jobs.

The White House confirmed the call and used similar language, saying: "The two leaders discussed their disappointment in the announced closures of General Motors plants in their respective countries and their plans for the upcoming G20 Summit".

The publication said Trump could make the move as soon as next week, now that the Commerce Department has presented him with a report that he asked for on the possibility of doing so on "national security" grounds-the same justification the president used for his steel and aluminum tariffs.

Barra's bright outlook managed to lift investors' confidence in spite of the layoff plan, pushing GM stock up seven percent on Monday.

Companies subject to Trump's attacks typically have been reluctant to respond directly, but industry groups like the Business Roundtable have frequently criticised the administration's trade policies for damaging U.S. competitiveness and raising costs.

Trump threatened Tuesday to cut off all federal subsidies to General Motors because of its planned massive cutbacks in the U.S. GM's actions would be the biggest restructuring for the carmaker since its bankruptcy a decade ago when they were bailed out by the government.

GM's announcement left manufacturing cities reeling.

The US President tweeted that tariffs were "being studied" and that duties could have stopped the GM closures.

The president also said other countries sending their cars to the USA have been taking advantage of the situation for decades.

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It's not clear precisely what action against GM might be taken, or when, and there are questions about whether the president has the authority to act without congressional approval.

Trump said Tuesday that he was "very disappointed" that General Motors was closing plants in the United States and warned that the White House was "now looking at cutting all GM subsidies", including for its electric cars program.

GM on Monday announced it would cut six gas-powered auto models as part of a plan to close factories and cut costs so it can spend more on electric and autonomous vehicle development. At a rally near GM's Lordstown plant last summer, Trump told people not to sell their homes because the jobs are "all coming back".

As he has done with several companies since he took office, Trump promised retribution for GM if it closes the plants.

"It's the classic Trump thing of policies he supports working against goals he also supports", Dutta added.

Before GM can shutter factories next year in Michigan, Ohio and Ontario, Canada, it must reach agreement with the United Auto Workers union.

However, the automaker has received more than $50 billion dollars in federal, state and local loans and grants since 2000, which includes funding it received for bailout assistance, according to a subsidy tracker.

BMW is considering building a second plant in the United States.

"We are at crossroads", he said.

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