As Trump's Rhetoric Pushes US Manufacturers Out of Mexico, China Leans In

Chinese car maker Great Wall Motors has announced that it is considering a major manufacturing plant in Mexico. It comes as several US car companies have faced significant pressure from US President Donald Trump to invest domestically, rather than abroad, including Ford, which recently abandoned a multibillion dollar plant in Mexico.

A skeleton shell of a factory lies gathering dust in San Luis Potosi in central Mexico. There are no workers or economic activity, but the building is a brand new construction of metal and concrete. It was supposed to modern US$1.6 billion car factory for Ford Motors.

Then Donald Trump was elected to make "America great again."

Ford responded by abandoning their factory, despite it already having been built. Instead, Ford will invest US$700 million in Flat Rock Assembly in Michigan.

Trump was quick to announce a domestic policy victory.

Big announcement by Ford today. Major investment to be made in three Michigan plants. Car companies coming back to U.S. JOBS! JOBS! JOBS!

— Donald J. Trump (@realDonaldTrump) March 28, 2017​

Throughout his campaign, Donald Trump galvanized crowds by promising to force US companies to invest within the US' borders.

Although popular with Trump's base, some economic analysts are concerned that Trump's populist rhetoric will have a harmful knock-on effect or other businesses, who could then pass on higher costs to US consumers.

In San Luis Potosi, a network of suppliers who had bet on a growing customer base that would emerge due to Ford's new car plant, are already feeling the pinch, as earlier projections of manufacturing, contracting and indirect jobs are falling short.

San Luis Potosi is expected to lose out on billions of dollars over the next five years.

However, China may step in to help. On Friday May 12, Great Wall — China's largest SUV and pickup maker — announced that is considering an auto plant in three Mexican states.

@ANCAPsafety awards two stars to ‘all-new’ Great Wall Motors Steed https://t.co/PJ84bZk7oe #crashtests #RoadSafety pic.twitter.com/MjF8bbZjyi

— One More Second (@One_More_Second) April 26, 2017​

The carmaker's chairman Wei Jianjun did add that an uncertain policy environment meant the details of the plan were still in flux, indicating that the Chinese are still unsure of what to make of US President Trump, three months into his term.

"Our plans to go to the American market haven't changed," Wei told reporters in Shanghai.

"First we want to see how things work and then make a decision."

Wei also revealed that the firm aimed to sell 100,000 cars globally overseas by 2020, up from 20,000-30,000 vehicles now, including in the US.

If Great Wall does choose to invest in Mexico, the US car manufacturers loss could be the Chinese's gain.