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By Aliss Higham
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Former President Donald Trump has threatened to ramp up tariffs on John Deere if the company continues with plans to move production of some models to Mexico.
The machinery manufacturer has announced plans to shift production of some of its models from Iowa to Ramos, Mexico, specifically mid-frame skid steer loaders and compact track loaders. The move is scheduled to be completed by the end of 2026, around midway through the next presidential term.
Republican nominee Trump made his feelings known about the plan during a policy roundtable in Smithton, Pennsylvania, hosted by the Protecting America Initiative.
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"They've announced a few days ago that they're going to move a lot of their manufacturing business to Mexico," Trump said. "I'm just notifying John Deere right now: If you do that, we're putting a 200 percent tariff on everything that you want to sell into the United States." Newsweek has contacted John Deere for comment via email outside of standard working hours.
However, the United States-Mexico-Canada Agreement (USMCA) signed by Trump in January 2020, a replacement for the North American Free Trade Agreement (NAFTA), prohibits the leverage of tariffs on a range of goods, allowing companies to manufacture in Mexico and Canada and export back to the U.S. without high costs.
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If Trump wanted to slap higher levies on John Deere and any companies vying to make similar moves, he would need to repeal the agreement. Withdrawal of trade agreements requires action from Congress.
Of the production move, which was announced in June this year, a spokesperson for John Deere said in a statement: "This move adds manufacturing flexibility for John Deere's Construction & Forestry business by establishing a new, globally competitive manufacturing operation."
The move has resulted in layoffs. More than 650 jobs were cut at John Deere's plants in Iowa earlier this year, according to U.K. newspaper The Guardian.
"The exact number of employees impacted by the moves will depend on overall Dubuque Works production levels when mid-frame skid steer loader and compact track loader production ends, attrition over the next two years, and reassignment opportunities for employees," the spokesperson said.
"The company deeply values the highly skilled U.S. workforce in our hometown communities that allow John Deere to make the best equipment in the world," a statement on the firm's website reads. "In response to challenging market conditions, we have recently taken steps to reduce costs—including workforce reductions. These decisions were difficult; yet, vital for our continued success and competitiveness."
As part of his presidential bid, Trump has vowed to raise costs for international trade in the U.S., including imposing a 10 percent or higher universal baseline tariff on all imports, and raise current tariffs on China to at least 60 percent.
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