Trump tweets trap firms in public relations nightmare

Share

Corporate crisis managers are redrafting their playbooks to deal with a new kind of public-relations problem: the Twitter wrath of the next U.S. President.

A single angry tweet from Donald Trump can quickly cost a company billions of dollars in stock market value, as Boeing Co. and General Motors Co. have discovered. Communications experts say the president-elect's bullying style and his adept use of social media often leave companies with only one realistic path – to bow down and give him the win he craves, even if it is not quite the truth.

Ford Motor Co. is the latest company to give Mr. Trump a victory by announcing plans Tuesday to kill a $1.6-billion (U.S.) Mexican expansion and create new jobs in Michigan.

Related: A new dawn on Wall Street?

Related: U.S. comes first, Trump official says about Canadian auto industry

Shribman: With a GOP-led Congress, a new Washington takes shape

During the presidential campaign, Mr. Trump vilified the auto maker, claiming that it was planning to "fire all their employees in the United States" and move the jobs to Mexico. That prompting Ford chief executive officer Mark Fields to strike back, calling the allegation incorrect: "It's really unfortunate when politics get in the way of the facts."

But since Mr. Trump's won the U.S. presidency in November, the auto maker has taken a less confrontational approach. First, Ford let Mr. Trump take credit for allegedly keeping a plant in Kentucky, even though it was not planning to move the operations to Mexico. Then came Tuesday's decision on the Mexican plant.

"Give him the easy victory lap now, even if it is not true," said Richard Levick, founder of Levick Strategic Communcations and a veteran crisis manager. "Right now in the short term, the smart game is to genuflect."

As businesses kick off the new year, one of the biggest risks they face is a disparaging Trump tweet.

Ford's announcement came the same day Mr. Trump used Twitter to threaten General Motors with a tariff for sending a Mexican-made version of its Chevy Cruze compact car for sale in the United States, which is legal under the North American free-trade agreement. "General Motors is sending Mexican made model of Chevy Cruze to U.S. car dealers-tax free across border. Make in U.S.A. or pay big border tax!" he wrote.

GM tried to correct the record, issuing a statement saying all its Chevrolet Cruze sedans sold in the United States were built in Ohio. The auto maker also said it builds the Chevrolet Cruze hatchback for global markets in Mexico, with a small number sold in the U.S. One of the plant's union leaders backed up the company's statement.

Gene Grabowski, a crisis-management expert, said companies had to be careful with how they corrected him.

"I would not go out of my way to say he was wrong. I would gently correct the record in a way that enables Trump to remain the hero," said Mr. Grabowski, a partner with public-relations firm kglobal.

"By confronting him, you frustrate him and you make him angry and you make him lash out. … Someone like Trump is always looking for a villain and if you volunteer to be that villain, he will try to destroy you. Let him go find another bad guy, don't volunteer to take him on. We advise clients to do this all the time," he said.

Companies are quickly learning how to navigate in the Trump era. Japanese telecom giant SoftBank Group Corp. played into Mr. Trump's campaign promises to bring back jobs to the U.S.

In a meeting with Mr. Trump, the company's chief executive said SoftBank would invest $50-billion in the U.S. and create 50,000 jobs. The investment was in the works before Mr. Trump won the U.S. presidential election, nevertheless SoftBank allowed Mr. Trump to take the credit.

"One option is to give him a perceived win," said Jonathan Bernstein, who runs his own crisis management firm and has worked with clients such as Craigslist during its controversy over adult services listings. "If it is fooling Trump, they are achieving what they want to achieve."

Another manufacturer, Carrier Corp., which like Ford was in Trump's crosshairs for relocating U.S. jobs, also gave Mr. Trump a perceived win when it agreed to keep some jobs in the United States.

In return, state officials agreed to give Carrier's parent company, United Technologies Corp., $7-million in tax incentives.

"As Carrier learned, there is gold at the end of that rainbow. You will get something in exchange either now or later," said Mr. Levick.

Some companies are learning the hard way. Boeing Co, which has a contract to build a new version of the Air Force One jet, saw more than $1-billion in market value vanish when Mr. Trump tweeted about cost overruns.

The president-elect said costs exceeded $4-billion and were out of control. "Cancel order!" he tweeted.

The aircraft maker issued a link to a statement on its Twitter feed saying that it was under contract for $170-million and that it looked forward to working with the U.S. Air Force to deliver the best planes at the best value.

Later in December, Boeing went went one step further to appease the president-elect. In a tweet, Mr. Trump targeted Lockheed Martin for costs on its fighter jet and said he had asked Boeing to price out a comparable fighter jet. Boeing respondedby saying that it was ready to work with the president-elect to affordably meet U.S. military requirements.

Boeing's stock has since recovered from its initial Trump-related drop.

"They can't afford to upset their largest customer. They will give him a victory lap and they are learning how to do it," said Mr. Levick.