Michael Smitka will be on a live program, Virginia Insight, on WMRA Public Radio in Harrisonburg Virginia Monday, July 13 at 3 pm EDT. You can listen to an archived podcast HERE.For more information see the show's website; the host Tom Graham brings a fascinating array of individuals to WMRA's studios, including periodic updates on Virginia politics. WMRA is my local station, and I'm glad to be a supporter!
Mike, I'm a native of Detroit, worked on a Ford assembly line (Rouge, truck engines) for a few months and now live in Rockbridge County. So, of course, I looked forward to your interview on Virginia Insights from when it was first scheduled.
ReplyDeleteThank you. You expressed/explained some of what I've been saying to friends here for years. I've had to defend the UAW and point out that foreign car companies didn't have to assume the burden of employee health care. You addressed this as I would.
I think I was the first caller in the show today, but it got a bit confusing. They didn't make it clear when I was on-air rather than talking to the screener.
My question regarded whether or not the foreign car companies would move some great deal of their production out of the US if they didn't have US companies to compete with. Certainly their final assembly plants would remain here -- always less expensive to ship parts to be put together close to the market. But all the components that make up the final product could be produced where the cost of labor is less.
Jim
Good to hear from you. Meet at the coffee shop sometime? My parents were both from Wyandotte, I grew up mainly on the far east side of Detroit proper.
ReplyDeleteActually the companies are fully committed to the US. For the most part I think that their production costs are lower here compared to Japan (esp at ¥93 per dollar!) or Germany (not a low-cost location!). That was not necessarily true in 1984, as at that time the plants were primarily assembly, and parts production / local procurement was modest. But over time engine and transmission plants were added to the mix, and roughly 300 Japanese parts producers set up shop here (and an equivalent number from Europe). Absent the current recession, most firms would not have the spare capacity to supply the US market. At the same time, much of the product is unique to plants here (e.g., the BMW Z4 is only made in Spartanburg, SC and the Toyota Tundra only in Texas). As you experienced, assembly plants are pretty big undertakings....though depending on when you worked at Ford, things would look rather different today. Eat-off-the-floor clean, air conditioned (if only on a "spot" basis), and (comparatively) quiet.
mike
PS I've not seen a number for many years; it used to cost about $700 to ship a car trans-Pacific. Logistics certainly matter; there's only one assembly plant west of Kansas City (and the Toyota plant in Texas), and it (a Toyota plant, until two months ago a joint venture with GM, in Van Nuys California) will probably be closed. The I-75 corridor is still pretty important, the east coast plants (other than BMW in SC) have closed or are slated for closure (Ford in Norfolk VA, GM ? in Delaware, others in MA and NY are long gone). But new plants have all been below the snow belt, which also happens to be less than friendly to unions.