Trump Reaches Deal With Carrier to Keep Jobs in Indiana, not in Mexico

[Bill]

Carrier says it has deal with Trump to keep jobs in Indiana | Fox News (http://www.foxnews.com/politics/2016/11/30/carrier-says-it-has-deal-with-trump-to-keep-jobs-in-indiana.html)

Hey, Cyber! You tired of winning yet?

:flag:

[Aerovette]

1. The average Mexican worker was to make $3.00/hr at the Mexico facility. Workers at this facility average $26.00/hr.

2. Carrier stood to save 65 million a year by moving.
They were incentivized $700,000.00/year to stay

3. I have been unable to get a solid number on how many are still being laid off.
I'm a Trump guy, but this is like Kohl's telling me I saved 75 dollars on my purchase. So what? I SPENT $200.00

[FasterTraffic]

Here's my take on why this makes sense:

“Every penny counts, but if we step back and I’m looking at earnings of $6.60 per share this year, 2 cents is an easy concession if the president-elect listens to some of the company’s bigger concerns,” said Howard Rubel, a senior equity analyst with Jefferies, an investment banking firm in New York.

If Trump is able to make good on his pledge to reduce government red tape and other regulations that do little else besides add cost to operations, the savings they missed in labor arbitrage will come to them later.

Roughly 10 percent of United Technologies’ $56 billion in revenue comes from the federal government; the Pentagon is its single largest customer. With $4 billion in profit last year, the company has the flexibility to find the savings elsewhere. Members of Congress have been pressing to punish big military contractors if they move jobs outside the United States.

Some of this is just bad luck on United Tech's part but they're the guys in the spotlight for offshoring manufacturing. If almost $6B in revenue is federal business, that's a lot of expensive opportunity for contracts to go elsewhere and vastly exceed the aforementioned labor savings.

Lastly, they appear to have 2,100 positions between the two manufacturing locations impacted and are retaining about 1,000. So, United Tech appears to be getting 50% of the planned domestic reduction. The article doesn't state it but I'd also be willing to bet there's a "...for now" somewhere in all the negotiations between Trump and United Tech executives. It plays well in the news today but it's not a certainty that those jobs are still in Indiana five years from now.


I love Kohl's but I laugh at that, too.

"Thank you, Mr Traffic. You spend $144 today and saved $6,502. If you had opened a Kohl's charge, you would have saved an additional $13,456."
"Wait, what?"

:funny:

[polarbear]

Here's my take on why this makes sense:



If Trump is able to make good on his pledge to reduce government red tape and other regulations that do little else besides add cost to operations, the savings they missed in labor arbitrage will come to them later.



Some of this is just bad luck on United Tech's part but they're the guys in the spotlight for offshoring manufacturing. If almost $6B in revenue is federal business, that's a lot of expensive opportunity for contracts to go elsewhere and vastly exceed the aforementioned labor savings.

Lastly, they appear to have 2,100 positions between the two manufacturing locations impacted and are retaining about 1,000. So, United Tech appears to be getting 50% of the planned domestic reduction. The article doesn't state it but I'd also be willing to bet there's a "...for now" somewhere in all the negotiations between Trump and United Tech executives. It plays well in the news today but it's not a certainty that those jobs are still in Indiana five years from now.


I love Kohl's but I laugh at that, too.

"Thank you, Mr Traffic. You spend $144 today and saved $6,502. If you had opened a Kohl's charge, you would have saved an additional $13,456."
"Wait, what?"

:funny:

Good take. To that I'll add Ford and UT demonstrated remarkably bad timing in their announcements to expand production outside of the US. They could have just as well painted a target on their backs. I think we'll see other Industries that will find themselves in the new Administration's crosshairs- notably just about everyone in the Silicon Valley. If I was a gambling man, I'd say Apple will be first up, along with any of them that rely heavily on H1B Visa's for staffing.

In the bigger picture, I think Globalism... at least in the current sense that multinational Corporations and Politicians understand it, is dead. Along with that, some powerful government agencies may be seeing some of their fangs removed. The EPA and the IRS come to mind randomly, but I'm sure there will be others.

[yell01]

1. The average Mexican worker was to make $3.00/hr at the Mexico facility. Workers at this facility average $26.00/hr.

2. Carrier stood to save 65 million a year by moving.
They were incentivized $700,000.00/year to stay

3. I have been unable to get a solid number on how many are still being laid off.
I'm a Trump guy, but this is like Kohl's telling me I saved 75 dollars on my purchase. So what? I SPENT $200.00

In Indiana you get 47% of your pay for unemployment with a max of $390/wk. If the average wage was $26/hr as mentioned let's take the unemployment pay to $250 per week per employee to balance it out. That's $12,000 a year x 1000 employees for a total of $12,000,000.00 per year in unemployment benefits (being conservative) vs. $700,000.00 in incentives. That is simple business right there.

Although, there is still about another 1000 jobs still going to Mexico. I would've said all or nothing but at least it's a start.

[Aerovette]

In Indiana you get 47% of your pay for unemployment with a max of $390/wk. If the average wage was $26/hr as mentioned let's take the unemployment pay to $250 per week per employee to balance it out. That's $12,000 a year x 1000 employees for a total of $12,000,000.00 per year in unemployment benefits (being conservative) vs. $700,000.00 in incentives. That is simple business right there.

Although, there is still about another 1000 jobs still going to Mexico. I would've said all or nothing but at least it's a start.

Right but that unemployment pay does not impact the financials of the company. As a business, the company loses. Only the state wins. If I am surrendering 65 million to make Trump look good, $700k/yr is not going to be enough.

[Cybercowboy]

Trump threatened United Technologies thusly: Keep that plant in the USA or we'll look at what the DoD can cut from your $6.8 billion in defense contract work you're scheduled for next year.

[Jeff '79]

Trump threatened United Technologies thusly: Keep that plant in the USA or we'll look at what the DoD can cut from your $6.8 billion in defense contract work you're scheduled for next year.

Brilliatnt !!
It's a free country and they're still free to do as they please. :seasix:
It should be a mandate.

[DAB]

Trump now telling peeps to buy Carrier A/Cs! :dance::smash:

[Bill]

News is reporting that Indiana kicked in $ 7M in tax abatements over multiple years to make this deal happen. I'm not terribly excited about that, if true. If Carrier gets an abatement, then every other business ought to get a commensurate abatement, too.

[OddBall]

News is reporting that Indiana kicked in $ 7M in tax abatements over multiple years to make this deal happen. I'm not terribly excited about that, if true. If Carrier gets an abatement, then every other business ought to get a commensurate abatement, too.

I agree. I think Trump is trying to get the ball rolling on keeping industry here, but he's treading close to what obama did.