Mexican state wants Ford to pay $65M for canceled plant
A Mexican state is charging Ford Motor Co. a $65 million penalty for a canceled project to build a local auto plant, weeks after the automaker announced it would instead start production in China.
The Mexican state of San Luis Potosí announced Thursday the money will be used to cover the state’s expenses in preparing the 690-acre plot for construction, Reforma newspaper reported.
“The company pays $65 million, which is the maximum stipulated in the agreement, to cover expenses incurred,” San Luis Potosí Gov. Juan Manuel Carreras said in a statement.
{mosads}
Ford originally planned to build its Focus small car at the Mexican plant, but later canceled the project amid political pressure from the Trump administration.
President Trump celebrated the cancellation. During his presidential campaign, Trump threatened to slap a 35 percent tariff on industrial products made by American companies in other countries.
Ford said last week that it will expand in Michigan and U.S. instead of building a BILLION dollar plant in Mexico. Thank you Ford & Fiat C!
— Donald J. Trump (@realDonaldTrump) January 9, 2017
Last month, Ford announced it was moving production of the Focus to China, which has lower labor costs than Mexico.
Ford said the move to China will help the company save $500 million in production costs.
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