United Auto Workers President Dennis Williams on Wednesday branded Republican presidential candidate Donald Trump “an enemy” of the American middle class, and warned automakers against expanding production outside the United States.
Williams rejected Trump’s suggestion that Detroit’s Big Three automakers move plants to lower-wage parts of the United States. He said that would hurt workers and weaken manufacturing in the industrial Midwest — as would plans to move production from the United States to Mexico.
“I think Donald Trump’s comments demonstrate what’s wrong with this country. I think he is a prime example of why we need a huge change in this country,” Williams told The Detroit News. “His comments about he’s going to make America great one day and then talking about diminishing people’s wages, to find less pay for them, is contradictory and he is an enemy — in my mind — of the middle class. He ought to do what he does best: build hotels.”
Deep in labor negotiations with Detroit automakers — the current contract expires at midnight Sept. 14 — Williams is working to boost wages among hourly workers and narrow the gap between so-called “legacy workers” and second-tier employees paid less. Some veteran UAW members haven’t had a pay raise in a decade. But they have received hefty profit-sharing checks in recent years. Williams declined to comment on the ongoing labor talks.
Asked about reports that General Motors Co. may export the Chinese-made Buick Envision crossover to the United States, Williams said automakers sometimes “float something out in the media” to gauge reaction of union leaders and members. “I think it was a temperature test.”
He said that investments in Mexico announced recently by GM and Ford Motor Co. haven’t helped. “It’s raised the temperature of our members. The bonuses that (executives) get, raises the temperature in the plant — so they haven’t made it easy.”
Trump: Shift work to South
In an interview with The News last week, Trump criticized investments by U.S. automakers, especially a $2.5 billion investment by Ford, in Mexico. He suggested automakers could reduce wages and still keep jobs in the U.S. by closing plants in Michigan and moving the work to lower-cost locations in the South.
“You can go to different parts of the United States and then ultimately you’d do full-circle; you’ll come back to Michigan because those guys are going to want their jobs back even if it is less,” Trump told The News. “We can do the rotation in the United States. It doesn’t have to be in Mexico.” After Michigan “loses a couple of plants — all of sudden you’ll make good deals in your own area.”
Williams says Trump is telling automakers “don’t build in Mexico, but go somewhere else where you can find lower wages and take advantage of people. What’s the difference? Philosophically, if we’re going to have a middle class in this country, people have to have disposable incomes; they have to have purchasing power; they have to have a right to buy a house, a car; they’ve got to send their kids to school. There’s a whole lot of things that we ought to be doing as a country, and Donald Trump is not about that.”
Although wages are lower at non-union U.S. plants owned by foreign automakers, hourly employees for Detroit’s Big Three are paid the same no matter what state they’re in, under the terms of UAW contracts.
A spokeswoman for the Trump campaign, Hope Hicks, declined to comment Wednesday about Williams’ remarks.
The union chief hasn’t endorsed a presidential candidate, but Williams said he will “probably be on the campaign trail talking about Donald Trump.” His predecessor, Bob King, spent a fair amount of time campaigning for President Barack Obama — even appearing in a rally in New Hampshire the day before the election to rally blue-collar voters.
Mexico investment boosted
Global automakers have announced more than $25 billion in investments in new plants and expansions in Mexico, which is now the world’s fourth-largest auto exporter. Most of the vehicles, built by workers making as little as $9 an hour, are coming to the United States.
In April, Ford said it would add 3,800 jobs in Mexico as part of its $2.5 billion investment on top of the 11,300 Ford already employs there. The automaker repeatedly has said it is not closing any U.S. plants as a result of its Mexican expansion.
Last week, the automaker said it was shifting production of heavy trucks, the F-650 and F-750, from Mexico to a factory in Ohio.
Last month, Ford said it would end small-car production at its Michigan Assembly plant in Wayne. It didn’t say where it would locate production, but some analysts have suggested the work will move to Mexico. The automaker has insisted it has no plans to close the Wayne plant and will add new production.
Trump repeatedly has said that if elected, he would not allow Ford to open a new plant in Mexico. At his campaign announcement speech in June, Trump said he would impose a 35 percent tax on every vehicle and part manufactured in the the plant. It isn’t clear how Trump could legally single out one automaker for punitive taxes.
Ford is not the only domestic automaker expanding to Mexico. GM in December announced a $5 billion investment there over six years. GM has 14 manufacturing plants there which employ about 15,000.
In addition, analysts believe GM has plans to move production of some Buick models from the United States and Canada to Europe and China over the next several years. If GM did import the Buick Envision to the U.S., it would be the first Chinese vehicle to be sold here by an American automaker.
Most automakers have feared a backlash from sending Chinese made vehicles to the U.S.
Analysts say while GM and the other automakers likely have their production plans cemented, the UAW may be able to win a vehicle or two during negotiations.
“We are neck-deep in UAW negotiations,” said Joe McCabe, president and CEO of AutoForecast Solutions LLC. “These could be bargaining chips on where the vehicle may or may not be built.”
GM has not announced other markets for the Envision, now only sold in China. But Jeff Schuster, senior vice president of forecasting for LMC Automotive, believes it will be imported to the U.S. from China late next year or early in 2017.
Both McCabe and Schuster believe production of only the Buick LaCrosse and Enclave will stay in the U.S. over the next several years. They both predict the Verano sedan will move from the Orion Assembly Plant.
If GM continues to sell the Verano in the U.S., McCabe believes it will be produced only in China, where it’s currently built for the Chinese market. Schuster also believe the car will be built only in China. McCabe expects the Canadian-built Regal will move to Europe in 2017, but Schuster believes production will move to China that year.
GM does not comment on production plans for future vehicles.