United States President Donald Trump demonstrated the extent of his anger towards General Motors on Tuesday. The president issued a threat to stop the government subsidies the company currently enjoys. The threat is a result of a recent announcement by GM warning of impending job cuts at U.S. plants.
A Tweet from the president explained that the United States ‘saved’ the company only to ‘thanked’ in such a fashion. The president then told his Twitter followers that he would consider putting an end to government subsidies for the company. He did not discuss in detail what subsidies to which he referred.
Electric vehicles from GM are to receive a tax credit of $7500 under current federal law. It is not clear if the president has the power to restrict the credit. It is also unknown if there are other credits he could target.
The words of the president seemed to have an immediate effect on investors. The value of GM shares dropped 2.6 percent following the remarks from Trump.
Hogan Gidley, a White House Spokesman, says the president discussed the General Motors situation with Justin Trudeau, the Prime Minister of Canada. Gidley says both leaders are disappointed at the cuts planned for America and Canada.
GM and other auto manufacturers are searching for ways to deal with a dramatic shift in the automobile market. The rising cost of technology and other factors has caused automobile makers to change their approach to the industry.
An increase in jobs from the automobile sector was a top priority for the Trump Administration. The president has been critical in the past over what he sees as a lack of effort by the company to increase the number of jobs available to American workers.
GM announced on Monday that as many as 15,000 jobs may be lost due to five plant closures in North America. Four of these factories are located in the United States. One of these factories is located in Ohio, a state that will be key to the president’s attempt to gain reelection in 2020.
A statement from GM assured the company is interested in maintaining its manufacturing presence in the country. The company explains that $22 billion has been spent to facilitate operations in America since 2009. The company says it hopes to add jobs by extending its autonomous and electrical vehicle programs.
GM added that many workers that lose jobs will have the opportunity to transfer to other plants in the country.