Thursday, June 23, 2005

Foreign Auto Companies Thrive in Southern USA

Mercedes-Benz, Tucaloosa, Ala. Plant Posted by Hello

Foreign Makers, Settled in South, Pace Car Industry : "By most accounts, the United States auto industry is in deep trouble. But don't tell that to the newest workers here in Alabama, where foreign carmakers are redefining the auto industry in America.

"...a quarter of all cars and trucks built in the United States are now made in factories owned by foreign automakers producing foreign brands, up from 18 percent in 2000. The assembly plants alone employ nearly 60,000 people, and that number continues to grow.

"The employment at the American companies still dwarfs that of the newcomers. Automakers in Detroit employ four times the hourly workers - 250,000 - but that number is continuing to fall. Already, G.M. has announced that it plans to cut 25,000 of those workers by 2008.

Union jobs at the Big Three plants pay a dollar or two more an hour - about $26 an hour compared with $24 or $25 an hour for the nonunion jobs at the foreign plants. But compensation at the American automakers swells to an average of $55 an hour when health care, cost of living and other benefits are counted, compared with $48 an hour, on average, at Toyota.

Toyota gets more out of its workers. Its plants operate at about 107 percent of the manufacturing capacity, meaning that they are constantly running on overtime, according to Harbour & Associates, a consulting firm that tracks manufacturing. By contrast, G.M.'s plants are operating at only 75 percent of their capacity, Harbour found.

Among the companies adding jobs, no company is courted more than Toyota, the world's richest car company, which is gaining strength even as G.M. falters.

Toyota's impact on the nation's economy has been powerful. A study by the Center for Automotive Research, which has yet to be published, estimates that Toyota's investments in the United States had led to 386,600 American jobs as of last year - including jobs at suppliers and in surrounding communities.

That includes the 29,000 assembly workers at Toyota's plants, plus another 74,000 people employed by the automaker in its California headquarters, design and engineering centers and at its dealerships. And those figures do not include Toyota's expansion plans. In Texas alone, the study estimates, Toyota will help create another 9,000 jobs.

The impact helps explain why "states are falling all over themselves to land a car company," said James T. Bolte, a Toyota vice president in charge of the Alabama plant.

In a state where the average wage is $31,000 a year, according to the Commerce Department, Toyota's workers earn $45,000 on average, with overtime, plus a benefits package valued by the company at $10,000. Workers receive medical, dental and life insurance coverage; a traditional pension plan and a 401(k) plan; an allowance for child care; and an annual cash bonus, which was $3,850 a worker last year.

Unlike plants run by Detroit automakers, where a worker can spend 30 years screwing on the same parts, everyone on the Toyota line is taught to do every type of assembly job, so they can switch positions when needed to keep production flowing.

"It was hard," Mr. Herring said, "but it all had a purpose."

To many, the purpose is the stability of a job at Toyota, which earned $4.8 billion in 2004, as the Detroit companies struggled. "

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