President Donald Trump said in a Tuesday tweet that his administration is looking at cutting all General Motors subsidies after the company announced plans to close several plants and lay off over 10,000 employees.
"Very disappointed with General Motors and their CEO, Mary Barra, for closing plants in Ohio, Michigan and Maryland. Nothing being closed in Mexico & China. The U.S. saved General Motors, and this is the THANKS we get!," Trump wrote in a tweet. "We are now looking at cutting all @GM subsidies, including……..for electric cars. General Motors made a big China bet years ago when they built plants there (and in Mexico) – don’t think that bet is going to pay off. I am here to protect America’s Workers!"
General Motors announced on Monday that they would idle five factories and lay off around 14,000 workers. The plant closings affect workers in Ohio, Michigan, Maryland and the Canadian province of Ontario.
The company's chief executive officer, Mary T. Barra, said there was no single reason for the cuts and called the actions a way for the company to stay competitive.
"We are taking these actions now while the company and the economy are strong to stay in front of a fast-changing market," she said on a conference call.
Some factors that might have contributed to GM's decision are weak new-car sales, the president's trade tariffs–which have raised production costs–and the company's previous investment in the production of smaller vehicles that didn't pay off.
Trump said he spoke with Barra on Monday and told her that he was not happy with the decision. In an interview with the Wall Street Journal, Trump said the company should open a new plant and not play around with him.
"They better damn well open a new plant [in Ohio] very quickly," Trump said. "You're playing around with the wrong person."
The federal government provides GM a subsidy for its electric car sales, CNN reports.
The federal government provides a $7,500 federal tax credit for each plug-in vehicle purchased. However, this subsidy goes away once an auto maker reaches 200,000 electric cars sold. And GM may hit that threshold by the end of the year, making its 2019 and 2020 tax credits smaller.
The news of Trump's threat to pull subsidies caused the company's shares to tumble in the stock market.