Trump is taking credit for new US factories. Does he deserve it?

Mint

6 days ago

The White House has an explanation for the nearly $2 trillion of manufacturing-related projects announced since the start of the year.
It's the Trump Effect.
'They're really coming in fast," Trump said at an April event with business leaders. 'Some of them don't bother calling us. Some of them don't even want meetings. They just start their plants and start their factories."
The White House maintains a running list of U.S.-based investments it says have been spurred by Trump's commitment to revitalizing American industry. Nearly 80 projects are included, from factories to data centers to a liquefied natural gas facility.
The Wall Street Journal examined the manufacturing-related projects on the administration's list that involved investments of at least $1 billion. Of those 33 projects, some involve R&D, equipment and machinery investments that are in line with the companies' typical spending. Others were in the works well before Trump was elected.
A White House spokesman said Trump has been 'a critical catalyst converting hypothetical discussions into firm investment commitments."
Defense technology company Anduril Industries, founded by Trump supporter Palmer Luckey, said last August that it had raised more than $1 billion to build a plant that will make autonomous weapons systems. Just before Trump's January inauguration, Anduril said it would put the factory in Ohio. The White House later added the project to its list of manufacturing wins.
An Anduril spokeswoman said while planning for the factory preceded Trump's presidency, he helped to build momentum around the project. 'The Trump administration is creating conditions for innovation and manufacturing to thrive," she said.
In February, Apple said it would spend $500 billion in the U.S. over the next four years to support efforts in artificial intelligence, silicon engineering and skills development for students and workers.
Apple's spending pledge, which later made the White House list, is roughly on track with its recent investments. The company has spent about $1.1 trillion over the past four fiscal years on operating expenses and capital expenditures, and analysts project about $1.3 trillion in spending over the next four years.
About 40% of Apple's revenue comes from the Americas, and a similar proportion of projected expenses would equal a little over $500 billion.
'Some of that's just existing R&D that would have been spent anyway," said William Kerwin, senior equity analyst at Morningstar. Apple didn't respond to a request for comment.
Ketchup and macaroni maker Kraft Heinz in May told Reuters it would spend $3 billion to upgrade its U.S. plants, seeking efficiency gains that could help offset Trump's tariffs. The company, which normally invests $1 billion a year on capital projects, said the investment would stretch over five years but wouldn't result in new jobs beyond construction work.
The White House a day later included the company's planned investment among a number of corporate announcements that it said showed that Trump's policies are paying off.
Some companies on the White House list have name-checked Trump in their announcements. Taiwan-based GlobalWafers, which makes the silicon wafers used in semiconductor manufacturing, said in May it intends to spend $4 billion to expand a just-opened, $3.5 billion Texas factory 'in alignment with market growth and Trump administration priorities."
Brent Omdahl, the company's senior vice president for government affairs, said the Trump administration has simplified reporting requirements and trimmed other red tape around a $406 million Chips Act grant awarded during former President Joe Biden's tenure.
'This is saving us time and money," Omdahl said.
Kraft Heinz, which normally invests $1 billion a year on capital projects, said it would spend $3 billion to upgrade its U.S. plants.
Pratt Industries, a packaging manufacturer owned by Trump backer Anthony Pratt, said at a White House event in April that it would invest $5 billion and create 5,000 U.S. manufacturing jobs to support Trump's call to reindustrialize America.
In 2022, when Biden was president, Pratt pledged to invest $5 billion, spread over 10 years. Since then, according to the company's website, it has opened four new plants, spending between $120 million and $700 million on each.
The April commitment, Pratt said, comes on top of its earlier pledge.
'Because of our confidence in President Trump, we're doubling down on the investment, in the same period of time," a company spokesman said.
In April last year, semiconductor company Micron Technology said it received $6.1 billion in Chips Act funding to support its roughly $50 billion investment in manufacturing facilities in New York and Idaho, part of a potential $125 billion investment over the next two decades. The company thanked the Biden administration for supporting investments that 'will ensure U.S. semiconductor competitiveness for generations to come."
This June, Micron announced an expanded U.S. investment commitment of approximately $200 billion. That included $30 billion in manufacturing investment beyond its earlier plans, along with $50 billion for research and development. The company thanked President Trump for his support.
The Trump administration added Micron's $200 billion total to its list. The company declined to comment further.
Chip maker Taiwan Semiconductor Manufacturing Co. last year received $6.6 billion in funding from the Chips Act. In March, TSMC announced plans to invest an extra $100 billion in chip-manufacturing plants in the U.S. over the coming years, which the White House added to its list.
The company made the move based on the needs of customers, who value geographic flexibility, Chief Executive C.C. Wei said in an April earnings call. He said that the investment came with 'strong collaboration and support from our leading U.S. customers and the U.S. federal, state and city government."
Trump is far from the first politician to claim credit for economic gains and corporate investment that already were under way. Biden touted creating millions of jobs during his administration, though the economy also benefited from the U.S.'s postpandemic rebound and stimulus efforts passed in Trump's first term.
One project highlighted by the Trump White House could be challenged by the president's policies. Glass manufacturer Corning this year said it would increase its investment to $1.5 billion in a Michigan factory that will make solar components.
Wendell Weeks, Corning's CEO, said during the April announcement that the expansion was a response to increasing demand for U.S.-made solar products. The White House added the project to its list.
Trump's recently passed budget bill will end tax credits for residential and large-scale solar projects. Analyst Paula Mints said the bill and a subsequent executive order targeting green energy will add economic risks for solar manufacturers.
Corning said solar remains one of the fastest-growing energy sources, and that 80% of the new factory's capacity is spoken for through 2030.
Write to John Keilman at [e-mail] and Harriet Torry at [e-mail]