NAFTA May Have Saved Many Autoworkers’ Jobs

New York Times ^ | March 29, 2016 | Eduardo Porter

[Olog-hai]

When Donald Trump threatened to “break” the North American Free Trade Agreement, auto industry workers offered up some of the loudest cheers.

Mr. Trump easily won the Republican primary in Michigan this month. The state, home base for the American auto industry, also delivered an upset victory to Bernie Sanders, the Democratic anti-NAFTA standard-bearer.

But the autoworkers’ animosity is aiming at the wrong target. There are still more than 800,000 jobs in the American auto sector. And there is a good case to be made that without NAFTA, there might not be much left of Detroit at all.

“Without the ability to move lower wage jobs to Mexico, we would have lost the whole industry,” said Gordon Hanson of the University of California, San Diego, who has been studying the impact of NAFTA on industries and workers since its inception more than two decades ago. …

[Hoodat]

The regulations that followed are anti-Free Trade.

[Olog-hai]

Such as?

[gleeaikin]

The truth of the matter is that when the Auto Makers came to DC to beg for money, they flew in their large private jets. You mean First Class airline seats were not good enough for them. This article compares relative compensation gains for Ford Motors CEO and ordinary workers.

http://archives.politicususa.com/2011/03/26/the-ford-motor-ceos-54-million-pay-put-in-into-perspective.html

This article provides details on Detroit history and the more recent recovery efforts.

https://en.wikipedia.org/wiki/Planning_and_development_in_Detroit

[Trumpinator]

NAFTA May Have Saved Many Autoworkers’ Jobs - that is a question - they don’t know after 30 years?

[Trumpinator]

The truth of the matter is that the management of the “big three” automakers over the past half century have capitulated to the UAW and continued to give the workers pay and benefits that were not sustainable over the long haul. -- nonsense - unfair free trade caused the collapse not salaries or pensions - proof is in Germany which should have collapsed with its high wages and pensions.

http://www.forbes.com/sites/frederickallen/2011/12/21/germany-builds-twice-as-many-cars-as-the-u-s-while-paying-its-auto-workers-twice-as-much/#49c87b5d289f

How Germany Builds Twice As Many Cars As The U.S. While Paying Its Workers Twice As Much In 2010, Germany produced more than 5.5 million automobiles; the U.S produced 2.7 million. At the same time, the average auto worker in Germany made $67.14 per hour in salary in benefits; the average one in the U.S. made $33.77 per hour.

[1rudeboy]

Haven’t been to Detroit recently, I see.

[1rudeboy]

And it’s rather disconcerting to watch FReepers embracing Marx’s “free trade will lead to revolution” crap now.

[Kickass Conservative]

The brand new design 2016 Camaro is now made in America.

Mustangs have always been made here, so the Dodge Challenger (like I own) will continue to be the odd man out still being made in Canada.

Two American Muscle Cars and one Canadian Muscle Car.
Sounds like the three Republican Contenders for POTUS.

[equaviator]

It’s important to make the distinction between the skilled and the unskilled and OEM’s and their suppliers. OEM’s and suppliers should be retaining their skilled “workers” in the US whether they belong to a union or not. Developing and updating their skills is worth investing in. You never know when OEM’s and suppliers might have to shift into war time production again.

[zeestephen]

Re: “In 2010, Germany produced more than 5.5 million automobiles; the U.S produced 2.7 million.”

Something is wrong with that USA number. Perhaps it is just for USA owned companies?

We produced 17.4 million cars in 2015. General Motors alone produced more than 3 million in 2015.

Re: “The average auto worker in Germany made $67.14 per hour in salary in benefits; the average one in the U.S. made $33.77 per hour.”

Comparing apples to oranges. Before the Great Recession in 2008-2009, America's Big Two were paying more than $70 an hour. Foreign auto companies - including German companies - in South Carolina and Alabama are (or were) non-unionized and pay in the $30 range.

It's also important to understand the geography. Germany, before re-unification, was only slightly larger than Texas. It is almost dead center in one of the most affluent regions in the world, a region that could easily fit inside half of America.

Finally, Germany produces internationally cherished luxury and performance brands like Porsche and Mercedes. America really can't compete in that market, except for Corvette, and maybe Cadillac.

[1rudeboy]

I kept my mouth shut until now. I’m a production worker for an OEM supplier. Just outside of Detroit. I was thinking about driving past a couple of Ford plants this morning on the way home from work and counting the cars in the parking lots, but I figured, why bother? People say Detroit is doomed.

[SkyPilot]

The truth of the matter is that the management of the “big three” automakers over the past half century have capitulated to the UAW and continued to give the workers pay and benefits that were not sustainable over the long haul. GM has more people living on retirement benefits that nearly bankrupt the company, than they have on their production lines. They are uncompetitive with the foreign automakers that have set up assembly operations here, but feed them the high-dollar value parts for their vehicles from their home countries and the don’t pay any tariffs to do so. When you add to that the $20.00 per labor hour disparity between the foreign and domestic plants, and it’s no wonder the American car makers are anxious to leave this county. From what I read, if it weren’t for their foreign markets, the big 3 would have gone under years ago. But again, it’s their own damned fault. They can’t pay $50. per hour for jobs that are worth half of that in the world market

All true.

I guess that also explains why they charge $70,000 - $80,000 for a pick up truck.

http://jalopnik.com/the-era-of-the-70-000-luxury-pickup-truck-1719222796

Browse Pickup Trucks from $75,000 to $80,000

[1rudeboy]

Don’t want a $70,000 pickup truck? Buy a cheaper import. It’s not that complicated, and making that $70,000 pickup truck more expensive won’t fix the problem you’ve identified.

[Cronos]

you can, if

1. your productivity is higher, so a $50/hour worker in the US is 3x productive than a $20/hr worker in Mexico
2. you standardize heavily your platform (why not have a common base track for most models and use standardized parts all round)?
3. you eliminate models and brands that are not working -- the big 3 did this kind of late

[Trumpinator]

No, it is comparing apples to apples as best one can do. It shows that salaries and benefits are not what causes exports to stumble. Also, Germany makes non luxury items also.

[equaviator]

The only thing “Motown” about Detroit anymore is the old “Motown Sound” and even that’s not saying much.

[equaviator]

I’m on my 2nd GMC 1500 W/T (Work Truck)...The ‘09 cost me $14K + tax, etc and the ‘12 was not a whole lot more. Both great vehicles and not without some very nice features and options for the money. If you must have a $40-70K truck, you might as well make it a motorhome.

[central_va]

Ford could have moved anywhere inside the USA. Screw them.

[central_va]

Without the ability to move lower wage jobs to Mexico, we would have lost the whole industry,”

Did Joseph Goebbels write that?

I am breathlessly waiting for Ford to announce across the board sticker price reductions on all cars made in Mexico.

[central_va]

And it’s rather disconcerting to watch FReepers embracing Marx’s “free trade will lead to revolution” crap now.

Love him or hate him he nailed the free trade thing. Because it is common scene. Common sense has no politcal affiliation.