Carrier Deal Case Study

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Trump’s Carrier Deal Puts Mexico in an Uncomfortable Situation President elect Donald Trump is said to have intervened in a deal between Carrier, a unit of United Technologies, and the city of Monterrey, in Northern Mexico. American owned Carrier, had plans to close two Indiana plants, and cut 2100 jobs to move production to Monterrey Mexico. However, after president elect Donald Trump stepped in, state officials offered Carrier tax breaks of $7 million to keep jobs in Indianapolis. (Reuters, 2016) This is typical of the United States, says a senior Mexican state official, as the feel that countries such s Mexico deal in banana republics. (Reuters, 2016) Banana republics – a small country that is economically dependent on a single export …show more content…
Turner says companies should make there own decisions and not be influenced by politicians. President elect Donald Trump also argues that Mexico has a benefit over the United States, and threatens to abandon NAFTA, between the United States, Mexico and Canada if better terms cannot be negotiated. Turner disagrees, saying that NAFTA has not benefited Mexico and it has cost his county millions of jobs. According to the World Bank data, economic growth in Mexico has averaged “2.6%” (Reuters, 2016) since 1994 when NAFTA went into affect. (Reuters, 2016) Turner continues to argue that the problem is not Mexico and believes Trump is sending the wrong message to American workers and Unions. However, Turner believes Trumps ambitions will still benefit Mexico in the long run and reminds us that “trade between Mexico and the United States did not begin with NAFTA” (Reuters, …show more content…
is not the World” (Campoy, 2016), and Mexico does not depend on the United States. Rodrigues says that the cancelled Carrier deal was only one of many that Nuevo Leon has in the works, and further comments that most are actually from Asia and Europe. Rodrigues feels that Trumps actions may tighten Mexico’s already growing ties with Asia. And considering how intertwined the U.S. and Mexican economies are, this only serves to put China, “the U.S.’s other commercial nemesis, closer to the American market” (Campoy, 2016). The United States stands to lose import and export jobs if the U.S., Mexico connection is broken. The Asian economy gains and the American economy suffers if American investment is blocked in Mexico. (Reuters, 2016)
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