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Corporate America Setting Up "War Rooms" To Prep For Potential Trump Tweets

Published: February 14, 2017
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Source: Zero Hedge

Since November 8th, several public companies have unsuspectingly fallen into the cross hairs of Trump tweets sending their stocks gyrating violently while adding or erasing millions of dollars worth of market cap in a matter of seconds.  Here is just a small sample:

 

As we pointed out back in January, Toyota's shares, along with the Mexican Peso, tumbled on Trump's threat to impose a "big border tax" on their Corolla imports as the unprepared and shocked company frantically drafted a response.

 
 

As Mr. Trump posted his message, Toyota’s chief communications officer, Scott Vazin, was packing his suitcase and preparing to leave his hotel room in Las Vegas, where he had been holding meetings around a trade show organized by the Consumer Technology Association. Mr. Vazin’s phone began to buzz as he faced a deluge of text messages and calls from his communications staff and reporters.

 

Once the tweet was sent, Mr. Vazin called Messrs. Lentz and Nagata to discuss the statement he would craft, as the company’s stock began to inch downward. The auto maker posted its response on Twitter less than two hours later.

 

“Toyota has been part of the cultural fabric in the U.S. for nearly 60 years,” said its statement, which bolded the name of the Mexican city where its plant will be located—Guanajuato, not Baja. The company touted its “$21.9 billion direct investment in the U.S.” and its number of employees and facilities in the U.S. Mr. Vazin said the company hasn’t been contacted by Mr. Trump since the statement.

Now, according to the Wall Street Journal, Trump's Twitter blasts, which often drive 'yuge' market reactions and come without warning, are forcing companies across the country to draft plans for “war rooms” to address a surprise presidential tweet.  Moreover, other companies are actively exploring strategically placing ads on MSNBC’s “Morning Joe,” CNN and “The O’Reilly Factor”—programs and networks fro which Trump has often appeared to draw inspiration for his tweets.

 
 

“Every business and association in Washington is thinking about how they would respond to a tweet from Donald Trump,” said Alex Conant, a partner at the communications firm Firehouse Strategies and a longtime Republican strategist.

 

In one recent simulation to prepare for a public attack by Mr. Trump, says consultant Eric Dezenhall, top executives of a science and technology company spent an afternoon in a room responding to various fallout scenarios, such as a stock-price plunge, congressional hearings or questions from investigative reporters.

 

Mr. Dezenhall says the company that
rehearsed the drill is now looking for something it can use as a potential peace offering to the president in the event of a critical tweet or other Trump tirade, “an equivalent to ‘we’re no longer building a plant in Mexico.’”

 

Lobbying shops are telling their clients to do a thorough review of their business interests, especially as they relate to federal contracts, so they can tell a story about how the firm invests domestically.

Still others companies have begun aggressively promoting previously announced job creation numbers in an effort to head off any criticism from the White House.  The latest example of such a move came from Intel's CEO, Brian Krzanich, who recently visited the White House to tout a $7BN investment in a facility in Chandler, Arizona which was already announced under the Obama administration.

 
 

Other companies have taken more proactive steps. Intel Corp. CEO Brian Krzanich last week traveled to the White House to roll out the company’s plans for a $7 billion investment in a major manufacturing plant in Arizona—plans that had been in the works for several years. Mr. Trump said following the announcement: “We’re very happy.”

 

Other companies, including Wal-Mart Stores Inc. and Amazon.com Inc., have issued press releases touting U.S. job creation numbers from previously planned store openings and expansions. Some are also turning to “social-listening” tools to monitor mentions of their products on social networks, analyze the fallout from Trump tweets about other companies and track what’s said on the accounts that Mr. Trump follows.

 

General Motors Co.—whose CEO Mary Barra has frequently spoken with Mr. Trump—said last month it would invest at least $1 billion across several U.S. factories, days after the president accused it on Twitter of moving Mexican-made vehicles across the border.

Guess we can add the cost of establishing these 'war rooms' to the list of excuses as to why companies will inevitably miss Q1 2017 earnings...at least they get to blame something other than the "weather" for once.

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