Global car giant Ford has cancelled plans to build a new $1.6bn plant in Mexico and will instead invest $700m in a Michigan manufacturing base, just hours after president elect Donald Trump blasted rival General Motors for building some of its cars south of the border.

Mr Trump had used Ford as a whipping boy during his presidential campaign, suggesting that it was moving manufacturing jobs to Mexico which should have been for US workers and vowed to slap a 35pc tariff on Ford vehicles made in Mexico but sold in the US.

He has repeatedly called for a rework of the North American Free Trade Agreement with Mexico and Canada.

Ford chief executive Mark Fields said that building the Michigan plant in the US was a “vote of confidence” in the US economy.

The company had previously fought back against Trump’s rhetoric, saying it did not plan to cut any US jobs.