Ford tells Trump no Lincoln SUV production going to Mexico

[November 18, 2016]  By David Shepardson

WASHINGTON (Reuters) - U.S. President-elect Donald Trump said Ford Motor Co Executive Chairman Bill Ford Jr told him the automaker would not move a Kentucky plant to Mexico, but the firm said it informed him the decision was to keep one vehicle in U.S. production.

On Thursday, Trump posted on Twitter: "I worked hard with Bill Ford to keep the Lincoln plant in Kentucky. I owed it to the great State of Kentucky for their confidence in me!"

"He will be keeping the Lincoln plant in Kentucky - no Mexico," the President-elect tweeted.

But Ford has repeatedly said it has no plans to close any U.S. plants and likely could not do so under the terms of the current United Auto Workers contract that expires in 2019.

This is not the first time Trump's comments about Ford production have been called into question. Last year, he took credit for Ford moving work from Mexico to Ohio, while the automaker had already made the decision in 2011 - long before Trump announced a run for president.

Spokeswoman Christin Baker said Ford "confirmed with the President-elect that our small Lincoln utility vehicle made at the Louisville Assembly plant will stay in Kentucky".

"We are encouraged that President-elect Trump and the new Congress will pursue policies that will improve U.S. competitiveness and make it possible to keep production of this vehicle here in the United States," she added, in a statement.

The company builds both the Ford Escape and Lincoln MKC SUV at its Louisville Assembly Plant in Kentucky, which Trump refers to as the "Lincoln plant" and where Ford employs about 4,700 people. It also has a separate truck plant in Louisville, where it builds pickups and larger SUVs.

It is not clear how many jobs would have been impacted if the low-selling MKC had moved to Mexico.

Ford has sold about 20,000 MKC SUVs this year in the United States, compared with 258,000 Escape SUVs.

Ford said last month it would suspend production of the Escape and MKC at its Louisville Assembly Plant in Kentucky for two weeks because of low demand.

In 2015, it told workers at the plant that it planned to phase out MKC production by 2019 and move it elsewhere.

The U.S. No. 2 automaker is planning to move some small-car production south of the border.

SCATHING CRITICISM

Ford has endured scathing criticism from Trump over its Mexican investments for nearly 18 months.

U.S. Republican presidential nominee Donald Trump appears at a campaign roundtable event in Manchester, New Hampshire, U.S., October 28, 2016. REUTERS/Carlo Allegri/File Photo

He has said at times incorrectly that Ford planned to fire American workers because of its Mexican investments. During his presidential campaign, the Republican candidate also said that if elected he would not allow Ford to open a new plant in Mexico and would slap hefty tariffs on any Ford vehicles made there.

A Trump spokeswoman did not immediately respond to questions about whether Ford's decision to keep production of an SUV in the United States would cause him to drop plans to impose tariffs on some Ford vehicles built in Mexico.

In April 2015, Ford said it planned to invest $2.5 billion to build two new plants in Mexico, adding 3,800 jobs in all. Earlier this year, Ford said it will invest a further $1.6 billion in Mexico for small-car production to start in 2018.

In September, Ford confirmed that all of the company's small-car production will leave U.S. plants and head to lower-cost Mexico by 2019, but no plants would be closed as a result.

Ford has repeatedly said no U.S. jobs will be lost because of the move - and it will produce two new vehicles at a Detroit area plant that built the small cars.

In October, Bill Ford said he had met with Trump to talk about his extensive attacks on Ford's investments in Mexico.

Ford said Trump's criticism was "infuriating" and "frustrating" because of the company's extensive investments and employment in the United States.

(Reporting by Eric Beech and David Shepardson; Editing by Sandra Maler, Bill Rigby and Himani Sarkar)

[© 2016 Thomson Reuters. All rights reserved.]

Copyright 2016 Reuters. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.