Posted on 06/20/2015 7:37:03 AM PDT by dennisw
Mexico has become the most attractive place in North America to build new automobile factories, a shift that has siphoned jobs from the United States and Canada, yet helped keep car and truck prices in check for consumers.
The past two years, eight automakers have opened or announced new plants or expansions in Mexico. In April alone, Toyota announced a new plant in Guanajuato to build the popular Corolla, work now done in Canada, while Ford unveiled plans for Mexican engine and transmission factories.
Low labor costs and fewer tariffs are the swing factors. A worker in Mexico costs car companies an average of $8 an hour, including wages and benefits. That compares with $58 in the United States for General Motors and $38 at Volkswagen's factory in Tennessee, the lowest hourly cost in the country, according to the Center for Automotive Research, an industry think tank in Ann Arbor, Mich. German auto workers cost about $52 an hour.
Mexico also trumps the United States on free trade. It has agreements with 45 countries, meaning low tariffs for exporting globally. That, along with low labor costs, convinced Audi to build an SUV factory in the state of Puebla. The German automaker will save $6,000 per vehicle in tariffs when it ships a Q5 to Europe, compared with building the same vehicle in this country, says Sean McAlinden, chief economist at the Center for Automotive Research.
Audi also sells the Q5 in the States, where tariffs on cars built in Mexico were dropped under the North American Free Trade Agreement.
The cost savings also should allow automakers to add expensive fuel-saving features to meet stricter U.S. government gas mileage requirements without raising car prices. Two-thirds of cars made in Mexico are shipped to the United States.
(Excerpt) Read more at providencejournal.com ...
Like I said.
Donald Trump is already having an impact.
Very, very good.
North American Free Trade Agreement]
Most American voters probably only know the acronym. And very, very few Millennials. Oh, and that Sarah Palin said she can see Russia from her house (Tina Fey).
If Trump gets elected and if he is able to do what he wants to do.....Just saying but this stuff should have started 20-30 years ago. By this I mean making “trade” work for us instead of for f’n traitorous money grubbing lobbyists and for foreign nations. Plus enforcing immigration laws and building a fence at the Mexico border.
I hear that Great Sucking Sound.
Someone warned me about it a long time ago, but I can’t remember who.
The German automaker will save $6,000 per vehicle in tariffs when it ships a Q5 to Europe, compared with building the same vehicle in this country ...
Donald Trump is an 'effing moron.
There have been many auto manufacturing plants built here in the U.S. since NAFTA was signed. Why the hell would the guy complain about NAFTA, then cite an industry that has seen tremendous growth here in the U.S. since NAFTA to make his case?
The meat of the story is that we really don’t dictate this. Lowering of European tariffs is a big factor. We could quintuple our Mexican tariffs and these plants would still get built.
Now you can buy an Audi from Mexico thanks to NAFTA!!! If you still have a job in America, that is.
Where unemployment is 5.4%. If you drop the other 15%-18% or so through lying with statistics.
If Donald Trump had his way, that Ford plant in Mexico will be shipping cars all over the world but not here to the U.S. -- while most Americans couldn't even afford the cars that Ford would be producing here.
They like to act like it’s a magic switch, put back your tariffs and all of a sudden jobs come back to America. They ignore that reality is a very complex place with stuff being sold all over the world and large quantity of reason to put plants in give places. Not to mention automation. At this point even if plants do get built in America don’t expect any of them to employ a whole bunch of people.
Trade will never "work" for the U.S. under these conditions. If U.S. auto workers even cost more than superior German labor, then a company like GM or Ford should have been out of business by now.
It's worth noting that Ford and GM actually pay their workers comparably to the $38/hour listed here for the newest auto plant in the U.S. in Tennessee. The problem (for many) is that they can only afford to pay their U.S. workers $58/hour if they offset these high labor costs with a bunch of $8/hour workers in Mexico. This is exactly why Ford built that plant in Mexico in the first place.
Korea-US Free Trade Agreement Two Years Out: Promise vs. Reality
Before the Korea-U.S. Free Trade Agreement (KORUS) was adopted, a lot of promises were made. This deal would result in more U.S. jobs and bigger markets for U.S. goods in Korea, we were told. The problems of the North American Free Trade Agreement (NAFTA) would be fixed, we were promised.
March 15 marks the second anniversary of this deal, and two years out, reality doesn't match up with any of those promises. That's a lesson that hasn't been lost on working families, consumers, greens and other citizen groups. And that's why there is such strong, and growing, opposition by ordinary Americans to another trade deal, the Trans-Pacific Partnership.
In 2013, under the first full year of the Korean Free Trade Agreement, the U.S. trade deficit with South Korea -- the shortfall between what we export to Korea and the goods that Korea exports to the U.S. -- was more than $20 billion, the U.S. Census Bureau reported, an increase of nearly 100% from deficits prior to adoption of this agreement.
The U.S. overall trade deficit with the 11 countries now negotiating with the U.S. for the TPP is $154 billion, and Korea has expressed strong interest in joining the TPP deal as well. Our elected leaders need to be reminded that trade deficits are directly linked to jobs. More U.S. exports in goods and services mean more jobs, except when those exports are dwarfed by a flood of imported goods and services, as has happened under every major trade deal in the past 20 years, including the Korea trade deal.
What happened to the 70,000 jobs that the Korea Free Trade deal was supposed to create? They never materialized. Instead, U.S. workers lost 40,000 jobs in the first year of the agreement.
Wow, a little honesty in this debate. And that's what these agreements have always been about: reduce tariffs of goods imported to the US to little or nothing, then move manufacturing plants out of the US to take advantage of cheap labor, lax regulation and other lower costs and no tariffs to ship products back to the US for sale.
And that's what TPP will be about plus who knows what else. The US will realize higher trade deficits, higher real unemployment, lower earnings for the middle and lower classes, and higher budget deficits due to more and more Americans on means tested poverty programs which already cost a trillion per year.
Every trade agreement has been sold as opening new markets to American products, increasing exports and creating new jobs. They do the opposite except for a few industries. I think the TPP will be great for US Pacific ports, at least until that work is diverted to Mexican ports.
I think this is going to be a sobering reality-check for Americans. The sad truth is that we are diminishing considerably on the world stage. One indication of this is that more and more countries are conducting business with each other without giving so much as a flaming sh!t about conducting business with the U.S.
They have the USA to dump all their losers on and give them hand outs. It is a no brainer.
Everybody enjoys all the cheap(er) goods. At the cost of the nation imploding. Yet the effects are real.
I’d say we’re past the tipping point.
Lol, you read it again.
Two-thirds of cars made in Mexico are shipped to the United States.
And a good portion of that remaining third probably goes to Canada, from which auto plants have also been relocated to Mexico.
The part about exporting from Mexico to Europe just disoriented you. The main reason to locate in Mexico is to export to the US and Canada.
Union greed and sad ass workers.
Every trade deal we sign is a rip off. The only ones who make money are the scumbag lobbyists in DC and the hack politicians they steer campaign contributions to. Many denizens of DC make out great from trade deals. America and its workers do not.
The foreigners also make out as our trade deficit only gets larger after every traitorous “free trade” deal
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