Recently, President Donald Trump threatened to trim all GM (General Motors) subsidies after the auto manufacturer declared of thousands of jobs cuts. In his tweet, Trump said: “Very disappointed with General Motors and their CEO, Mary Barra, for closing plants in Ohio, Michigan and Maryland. We are now looking at cutting all @GM subsidies, including for electric cars.”
Trump’s threat came after GM publicized plans of cutting 14,000 jobs and close five facilities in the North America region, dealing with the president’s pledge to aid auto employees. GM stated that the moves were intended to set up the firm for upcoming electric and driverless vehicles. GM is still not clear to what subsidies Trump was mentioning. A source well-known with the situation told CNN Business that GM is not aware of any noteworthy federal financial assistance the company is getting outside a $7,500 plug-in tariff credit, which goes to the buyer, not the company. The federal government gives that tax credit for every plug-in vehicle obtained. However, this financial assistance goes away when an auto manufacturer sells 200,000 electric cars. Jeremy Acevedo—Manager of industry analysis at Edmunds—stated that the entire business is qualified for this. It is not limited to GM.
Recently, GM was also in news as its shares fell after Trump threatened to cut its subsidies as payback for layoffs. The auto manufacturer’s shares fell subsequent to the tweets and were reduced by over 3%, on track for their most terrible day in a month. In its statement, GM said it is “dedicated to maintaining a tough manufacturing occurrence in the U.S.” and stated that “many of the U.S. employees affected by the plant closures will have the chance to switch to other GM plants.” The company further stated that GM appreciates the steps this government has taken in support of industry to advance the overall competition of US manufacturing, without openly pointing Trump’s threat to cancel subsidies.