Hyundais cost/car versus The Big 3 American Car Manufacturers

Interesting article in "Michigan Today" from the University of Michigan. According to Walter McManus, Director of the Uof M Transportation
Research Institute, Automotive Analysis Division.
The following excerpts are eye opening; Ford, GM and Chrysler spend $2903 per car on labor alone, Hyundai spends $551. Hyundais retirement expenses are $24 per vehicle, while the big 3's cost $411 per vehicle. Big 3 health care cost is $1280 per vehicle, Hyundai's is $27 per vehicle. Likewise Japanese health care and pension costs are a fraction of what their American competitors pay.
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Dave in Lake Villa wrote:

Yes, and the Japanese and Koreans who manufacture in the US will eventually begin to have some of these problems also. They simply don't have the large "tail" of retirees that the longer standing US companies have here in the US. However, I'm not sure that the US automakers will survive long enough for this to affect their competitors and return the playing a little towards level. However, you will see the cost of Hyundai's climb as their costs increase as well.
Matt
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The same thing killed the steel industry in this country, High union wages and benefits. I think most of the Korean cars produced in the U.S will probably be in the traditionally non-union south.
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Jack Cassidy wrote:

That's what they'd like you to think, and they've done a good job getting a lot of people to believe it.
The major factor that has hurt American manufacturing is not unions, pensions, labor cost or healthcare. In reality it is our government's unwillingness to insist on a level playing field with our trading partners. We allow free trade even though our partners choose to not abide by similar environmental regulations, overtime, labor rules, social security, safety regulations, and so on.
We can de-unionize every job in America and we still cannot compete with Asia because they don't abide by the same rules as we do. If the government were to have some backbone and say, no more free trade until you treat the environment and your workers better, only then could we hope to compete with them.
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So you want the U.S. Government to TELL other industries in other countries how much to pa their workers? What kind of benefits to give their workers? Like it our not the U.S. high standard of living created high wages, now other Countries have the capability to compete without the expense. In time as their standard of living increases so will the cost of business.
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Rob wrote:

It's already happening. I've read two articles in the last couple of months about China outsourcing to other countries such as Vietnam as their labor costs are getting too high. :-)
What goes around, comes around.
Matt
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It is the same in all industries! The IT field is seeing jobs outsourced to Bangalore in India outsourced to places like China. Infact giants like Infosys already have their own centers in China
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The only problem with your theory is the rust belt Northeast part of this country became the rustbelt before the free trade agreements. Companies like Mack Truck left Pennsylvania to move down south, not out of the country. The problem remains today, The south has always had lower non-union wages. Do the foreign auto makers that produce cars in this country have UAW workers? Then we have things like the Overseas Private Investment Corporation (OPIC) that guarantee companies that move out of the US to banana republics that they will not lose money if nationalized by these governments. We are literally guaranteeing the success of companies that leave here and put Americans out of work. I don't know what the solution is, I don't think de-unionizing all jobs is the answer nor is protectionism. Unions were in large part responsible for creation of the middle class in this country, but the management decided they would rather rob the union members than protect them. And if we protect our industries from foreign competition we end up with products that nobody wants, Remember the junk Detroit produced in the 70's and 80's? Toyota was a wake up call. Jack Cassidy
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On Mon, 03 Jul 2006 01:46:55 GMT, "Jack Cassidy"

If you want to pick Unions to go after it's the public employee unions. They get their raises, paid benefits and more holidays than I can name but the manufacturing sector get's the bill. NY is the leader in this but seveal other states are not far behind. manufactuing wages have been on a steady decline as jobs left but government wages (direct and indirect) have been growing at more than the inflation rate. The result has been taxes growng at more than the inflation rate and the greying of the state as the early to mid career workers leave.
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Bingo!
Unfortunately, NY can't close up shop and move down South. Even if they could, nobody would want them. :)
All kidding aside, if the unions keep growing, we are heading more and more toward a French-like society. <shudder!>
--
Bob

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<snipped>
I can see you've never been to Spring Hill, Florida. <g> Just about everyone there is either from New York or Michigan, Especially during the winter months. Hell, at least they're not Canadians
Jack Cassidy
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On Tue, 04 Jul 2006 16:27:33 GMT, "Jack Cassidy"

that will taper off also. As the economy continues to collapse fewer folks will be retiring from NY so they won't be going places to "winter".
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Greed is a big factor too. Often CEOs come in to "fix" companies, but in reality just make them profitible for the short term. In the '70s US Steel turned a healthy profit for one quarter by selling their next-generation steel making technology to Japanese firms.... not long thereafter, Japanese steel went from a crappy cheap alternative (used in cars like the Pintos of the early '70s) to cheaper AND better quality than US steel.
Basically we seem to be willing to sacrifice long-term sustainable growth for quick "get rich" returns. As a result, we are bankrupting our nation's future. Well, most of those bastards will be dead by the time the US collapses into a 3rd world country, so what do they care?
--
KWW

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