Skip to comments.Fresh Walkouts Halt Production At Toyota, Honda Plants (MORE CHINESE AUTO MFG. PROBLEMS)
Posted on 06/23/2010 10:03:09 AM PDT by Chi-townChief
TOKYO (AP) Toyota Motor Corp. and Honda Motor Corp. said Wednesday they stopped production at some of their car assembly plants in southern China after parts suppliers were hit by more labor unrest.
The fresh walkouts at the Japanese car makers are slowing output and adding to costs at a time when both companies have been ramping up production to meet strong demand.
Chinese migrant workers, the backbone of the country's industrial sector, are becoming increasingly vocal in demands for higher wages. Several auto-related labor disputes have erupted recently in the Guangzhou region, where both Toyota and Honda have manufacturing bases with local partner Guangzhou Auto Group.
Honda, Japan's No. 2 automaker, said production at one of two auto assembly plants at its joint venture Guangqi Honda Automobile Co. was suspended. Honda said it was unclear when the plant can resume production.
The shutdown was due to a shortage of parts supplies caused by the strike. But Honda declined to give further details, including the name of the affected parts supplier.
Toyota's plant in Nanshan near southern Guangzhou, which represents about half of its total capacity in China, remained shut after the strike forced the world's biggest automaker to suspend production a day earlier.
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It will be interesting to see if communists tolerate labor unions hustling their game?
The labor union (there is only one) in China is part of the Commie Party apparatus. These strikers are acting on their own outside of the union. The Commies seem to be tolerating it so far, so long as they are striking against Japanese companies and not Chinese ones.
I’m kind of surprised that the Japanese didn’t demand non-union plants before opening on the mainland but I guess they got greedy.
I’m not sure the commies have the luxury of ‘allowing’ this to happen or not.
The problem here is that WHEN the workers win better pay and benefits from the foreign companies, the Chinese ones will now be working as hard for less money.
Unless the ChiComs plan on making them stay at their jobs at gunpoint (a possibility), there will be an exodus from the Chinese firms to the foreign ones. If they make the workers stay at the Chinese companies, the quality will drop.
Either way, the Chinese have two economic advantages - 1) A complete disregard for their own environment and any costs associated with mitigating damage to the same and 2) slave labor wages.
Those aren’t sustainable competitive advantages.
In the end, the iron rules of capitalism apply.
To have a viable market, you need:
1. Ability to enforce a contract
2. Right to own property
3. Freedom of speech
It’s like the combustion triangle. Take any one of these away and you don’t have fire.
China’s going to collapse. It’s that simple, and its happening faster than I thought it would.
Japan came on strong in the 1970’s, and then wages started catching up with the rest of the developed world as real estate speculation and too much easy money inflated prices.
Japan’s still sleeping off its hangover. The US is still piss drunk and not even close to having the hangover yet.
China’s going to end badly. At the very moment that the market for their crap is drying up overseas, workers are demanding higher wages and benefits.
They will soon no longer be the low cost producer, they don’t even understand the concept of quality, and they’re idea of customer intimacy is providing pictures with the unintelligible English translation of the Chinese instructions for assembling their cheaply made toys.
Welcome to the mushy middle. If Chinese wages rise as much as say 20 to 25%, the cost of transportation may make places like Guatemala and Mexico more attractive places to manufacture most everything again.
The official union in China represents all workers at all companies. There is no such thing as a non-union plant in China.
That said, the union there is not like unions here. The Chinese union almost always sides with management.
Workers demand changes in work conditions, ability to organize and negotiate independent of communist government, and a raise from Y1000 to Y2000 a month.