President Donald Trump took credit for General Motors' announcement this week that it would close an underutilized factory in South Korea, saying GM was "moving back from Korea to Detroit." Those comments do not jibe with reality.
Trump's televised remarks, made during a meeting on trade with South Korea, began by reading the first sentence of GM's official statement in which it said it plans to close its plant in Gunsan, South Korea, by the end of May. He then added "and they're gonna move back to Detroit."
"You don't hear these things except for the fact that Trump became president. Believe me, you wouldn't be hearing that," Trump said. "So they're moving back from Korea to Detroit, they're moving. Also, you saw Chrysler moving from Mexico to Michigan, and you have many other companies, they all want to be where the action is."
Trump credited the recent tax cuts he signed before adding, "so General Motors is coming back into Detroit. That is a really significant statement."
In reality, the GM plant in question doesn't produce vehicles sold in the United States and did not announce that their production will be moved to Detroit.
Located in Gunsan, South Korea, and employing 2,000 workers, the plant produces the Chevrolet Orlando, a three-row compact crossover not sold in the United States, and the Chevrolet Cruze for non-American markets. American-market Cruze sedans and hatchbacks are built in Mexico and the United States. The Gunsan factory had been running at only 20 percent of capacity over the past three years. GM will continue to produce the Chevrolet Trax, Chevrolet Spark and Buick Encore in Korea for the American market
"That announcement in particular was about our Gunsan plant closing and our need to restructure the business in South Korea," David Albritton, GM's executive director of product development and internal communications, told the Detroit Free Press. "We are trying to create a plan that creates a viable business long-term in Korea. Our costs are out of whack, we've lost lots of money over there with the operation of our business."
Since 2015, GM has withdrawn from Europe, Australia, South Africa and Russia after struggling for years to turn profits in those markets. It sold its Opel and Vauxhall brands last year for $2.3 billion to PSA Groupe.
President Trump's reference to Chrysler relates to Fiat-Chrysler's decision to move production of the Ram Heavy Duty pickup from Mexico to its Warren Truck Plant in suburban Detroit. FCA's Mexico plant will remain open. Trump has also criticized Ford for its plans to build cars in Mexico.