John Deere is the latest company to draw the ire of former President Donald Trump for investing south of the U.S. border. At an event Monday in the battleground state of Pennsylvania, the Republican nominee threatened the company with a “200% tariff” if it shifts some production to Mexico as planned, causing the stock to briefly sag in after-hours trading.
Facing rising costs and declining demand, John Deere announced earlier this year that it would lay off over 800 workers across factories in Illinois and Iowa. The company has also bought land in Ramos, Mexico, for a new facility that will take over production currently done at its plant in Dubuque, Iowa.
“I am just notifying John Deere right now that if you do that, we are putting a 200% tariff on everything that you want to sell into the United States,” Trump said at roundtable focused on threats to U.S. farmers, principally from China.
As he did in 2016, Trump has made protectionism key component of his campaign. He’s proposed a worldwide tariff of 10%, as well as a 60% tariff on all Chinese goods. He’s also resumed his attacks on American companies expanding in Mexico, a consistent refrain since his first run to the White House.
“They think they are going to make product cheaper in Mexico and then sell it in for the same prices they did before,” he said Monday of John Deere, “making a lot of money by getting rid of our labor and our jobs.”
In response, the company has pointed reporters to a statement on its website that touts the company’s commitment to U.S. manufacturing, including $2 billion invested in domestic plants since 2019.
“In order to position our U.S. factories to undertake these highly value-additive activities it is sometimes necessary to move less complex operations, such as cab assembly, to other locations,” the statement said.
John Deere shares recovered by Tuesday afternoon, trading slightly above the previous day’s close. While the stock is up just 2.5% this year, trailing the 21% gain for the S&P 500, it’s beating the index over the last five years roughly 150% to 93%, respectively.
John Deere may learn from past Trump targets
The company is far from the first targeted by Trump over moving production to Mexico, though the former President's claims of job displacement have often been exaggerated. Trump famously called for a boycott of Oreos in 2016 after Nabisco-parent Mondelez said it would be shutting some production lines at its Chicago factory while boosting output in Mexico. The future president falsely claimed the factory was being closed.
That year, Trump also attacked U.S. automakers like Ford and General Motors . He went after climate and energy company Carrier for its plans to shutter two Indiana plants and move manufacturing to Mexico. At one point, he called on Americans to stop buying iPhones.
John Deere may be reassured from past examples, however, that the former President can be placated if he returns to the White House. After winning in 2016, Trump took credit for several decisions by Ford to scrap or adjust plans in Mexico and add jobs in the U.S. The company said those moves would have been made even if he had not been elected, though then-CEO Mark Fields did characterize them as a "vote of confidence" in Trump's tax and regulatory proposals.
Trump did undoubtedly convince Carrier to change course, calling the CEO of its then-parent, United Technologies, shortly after being elected. A few days later, the company and president-elect announced a deal to keep roughly 1,100 jobs in the U.S., though The Washington Post later reported a greater number of positions in the state were cut in the years that followed.
If past examples are any indication, John Deere can expect to stay in Trump's crosshairs throughout election season. Whether the results on Nov. 5 could push the company to change its plans, however, remains unclear.
This story was originally featured on Fortune.com
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