The heating, air-conditioning and refrigeration solutions provider said it is backing off plans to shift production from a plant in Indiana to Mexico after striking a deal with President-elect Donald Trump and the state of Indiana.
Carrier Corp., a manufacturer of heating and cooling systems for residences, commercial spaces and transportation conveyances, announced Wednesday after talks with President-elect Donald Trump’s transition team, that it will reverse plans to move production from its Indianapolis plant to Mexico.
Trump castigated the United Technologies subsidiary during the campaign for its decision early this year to close the furnace plant and lay off 1,400 employees, saying it was an example of companies taking advantage of lax trade rules to offshore production at the expense of blue-collar workers. His rhetoric on trade and manufacturing resonated with many voters in the so-called Rust Belt, where manufacturing capacity has declined during the past 25 years.
“We are pleased to have reached a deal with President-elect Trump and Vice President-elect Pence to keep close to 1,000 jobs in Indy,” Carrier said on Twitter.
Terms of the deal and what, if any inducements, were promised to keep Carrier at home have not been disclosed so far. The government of Indiana, which was headed by Pence until last summer, was unable to structure an incentive package that Carrier liked.
CNBC reported that the state of Indiana offered new incentives to make the agreement work.
Carrier will save about $65 million per year by shifting production to Mexico, part of a broader United Technologies’ strategy to cut costs, according to The Washington Post.
Trump also took credit 10 days ago for rescuing a Ford auto assembly plant in Louisville from moving to Mexico, but Ford had only planned to transfer a low-volume SUV production line to Mexico while ramping up production of another model with no negative impact on jobs.
Ford officials suggested that Trump’s basic economic plan to increase infrastructure investment, reduce regulations and reform the corporate tax code would reduce overall costs and make domestic production more viable, a factor that Carrier officials apparently considered too, according to the New York Times.
The newspaper also said Trump is expected to tone down his calls for high tariffs on imports from companies that have shifted facilities to Mexico.
Carrier Corp. backs off plans to shift production to Mexico following Trump victory
