It has finally arrived, the year in which Toyota is expected to overtake General Motors as the largest auto manufacturer in the world. If this was in the wake of the oil shortages of the mid-1970s or the early
1980s there would be a cry across the country to buy American --- to save GM. But this is the 2000s and Toyota looks more like an American company than does GM. While GM has continued to shutter its plants in the United States and spend its investment dollars in "low cost" countries such as China, Toyota continues to invest in new production plants in the United States and in American suppliers.In an effort to keep the foreign automotive onslaught at bay, the domestics OEMs (original equipment manufactures) pushed through legislation that required all new cars to be labeled with the percent of domestic (American) content, believing that consumers would want to "buy American." This content sticker requirement is now coming back to haunt GM and Ford (Chrysler is no longer a domestic, but a German company), as consumers are seeing higher U.S.-supplied parts and assembly from companies like Toyota.
According to the Center for Automotive Research, Toyota purchased $28 billion in materials, components, goods and services from U.S. companies. It either directly employed or supported the employment of 386,000 American automotive workers. Automotive industry reports indicate that Toyota is now planning another U.S. assembly operation; all this while GM continues to surrender its American presence and employment.
Welcome to the 21st century and the rise of Toyota. I wonder how long it will take before all our domestic automotive companies are simply an afterthought in the global competitive market. In one of its most recent moves, after demanding its suppliers follow them to Mexico, Ford tossed out Lear, Johnson Controls and others on one of its key interior programs in favor of a new "low cost region" supplier. So like GM, not even in the NAFTA region are the OEMs capable of demonstrating any loyalty to its "home market" and domestic suppliers.
GM simply is in an endless race for the cheapest (not just the lowest cost) components it can find. It is a race that it will never win, always suffer from, and will ultimately lose whatever customer loyalty it has left. Toyota, even after paying higher prices (maybe) for its components from American suppliers, makes a much better car or truck than GM. So when we hear the cry to "Buy American," we just may be talking about buying a Toyota.
Jeff Wincel is principal of the LSC Consulting Group in Holland and an adjunct professor at Grand Valley State University's Seidman School of Business.
-- The credit belongs to the man who is actually in the arena; whose face is marred by dust and sweat and blood; who strives valiantly; who errs and comes short again and again; who knows the great enthusiasms, the great devotions and spends himself in a worthy cause. Who at the best, knows the triumph of high achievement; and who, at the worst, if he fails, at least fails while daring greatly. T.R. April 10, 1899