US President-elect Donald Trump has trained his sights on Mexico, holding talks on his promise to build a wall on the US-Mexico border.
He also warned another car firm to build its products on American soil or face a hefty border tax.
Congressional Republicans and Mr Trump’s transition team are discussing the evolving plan under which his administration would rely on existing legislation authorising fencing and other technology along the southern border, according to sources.
Congress would be asked to ensure that enough money is appropriated to take additional new steps, but would not pass a stand-alone bill authorising a huge new wall along the southern border – avoiding a vote Mr Trump would probably lose.
The Mexico issue also raised its head as Mr Trump warned another firm – Toyota – about its plans to build a plant in Mexico.
He tweeted on Thursday that the Japanese car-maker plans to build a factory in Baja, Mexico, to construct the compact Corolla. He warned the company to set up the plant in the US or pay a massive border tax.
He wrote: “Toyota Motor said will build a new plant in Baja, Mexico, to build Corolla cars for U.S. NO WAY! Build plant in U.S. or pay big border tax.”
The threat is similar to those targeted at Ford and General Motors. Mr Trump has repeatedly threatened Ford with a border tax and this week called out GM for importing cars from Mexico.
Mr Trump has the location of Toyota’s new Mexican plant wrong. The company announced in April that it would build a Corolla factory in the central part of the country.
Nearly all car-makers build small cars in Mexico to take advantage of lower wages. Consumers generally pay lower prices for small cars, making it difficult to cover higher labour costs in the US.
Corolla production is to start at the Mexican plant in 2019 with a new model and would be moved from a factory in Cambridge, Ontario. Toyota will also keep building Corollas at a US factory in Blue Springs, Mississippi, while the Ontario plant will build more higher-priced vehicles.
Toyota has not directly addressed Mr Trump’s tweet, but said in a statement that production and employment in the US will not decrease due to the Mexican plant.
It said it has invested more than $17 billion in its US operations, including 10 manufacturing facilities, 1,500 dealerships and 136,000 employees.
“Toyota looks forward to collaborating with the Trump administration to serve in the best interests of consumers and the automotive industry,” the company’s statement said.
On Tuesday, Ford announced that it has scrapped plans to build a new small-car factory in San Luis Potosi, Mexico, and will instead invest some of that money in a US plant near Detroit that will build new electric and autonomous vehicles.
But Ford still plans to shift production of the compact Focus to Mexico by adding it to an existing factory that builds mid-size cars.