Posted on 07/06/2020 9:33:00 PM PDT by SeekAndFind
The new North American free trade agreement that goes into effect Wednesday was touted by U.S. President Donald Trump as an engine of American job creation. But Japan's automakers are largely opting instead to keep operations in place and pay Mexican workers more or even just pay tariffs.
The US-Mexico-Canada Agreement requires 40% or more of parts for each passenger vehicle be manufactured by workers who are paid at least $16 per hour as a condition to make them tariff free in the region. Trump hailed that feature as a way to boost production in the U.S., which has a higher hourly rate than Mexico.
However, this looks to be wishful thinking. The ratio of US-Canada parts among Mexican-assembled vehicles sold in the U.S. was 13.5% in 2018, according to the U.S. Department of Transportation Highway Traffic Safety Administration. Trump's theory was that U.S. production would inevitably increase to meet the 40% requirement, but Japanese automakers, which had already positioned their production bases according to the old NAFTA regime, are not simply willing to pull up stakes and redeploy.
One reason is the cost of moving production. Honda Motor-affiliated parts maker Keihin will raise the hourly wage of employees at a factory in Mexico to $16 by next month -- triple the average rate of a parts factory in Mexico, but still cheaper than making a move. Because the pandemic has hurt earnings, the cost of the moving production will likely be too burdensome over the foreseeable future.
Auto component maker Piolax, will also raise the hourly wage at its Mexican plant to $16 within the year. The company is also installing robots to mitigate rising labor costs, President Yukihiko Shimazu said.
(Excerpt) Read more at asia.nikkei.com ...
I agree that in the political world, that is what they are, a way to feather beds and further political agendas...
My guess too...
They still won’t. There’s just way too many reasons to not build here. Labor costs, EPA costs, HR costs, antiautomation unions. Not to mention serving a global market, the cars are destined for everywhere, so they’re imported into most target markets. Little bit of tarriffing here and there doesn’t change much. Especially when you’re talking adding hundreds of dollars to things sold for $20 thousand and up.
Point to the post where I said that we do not need to bring jobs back to the US.
Cant blame them. Who would move a company during the corona mess?
I’m not anti-tariff. I support PT. Try again.
I’m not. I support PT with the tariffs he’s implemented. I believe we should be employing Americans and manufacturing here. Try again.
Then why are you against tariffs? Why not force the Issue with a border tax?
One lesson the Coronavirus drove home is that we can't rely upon foreign supply for medicine and medical supplies, and we shouldn't rely upon the ChiComs for anything. Not a tariff issue.
If a foreign company/country commits an act that would violate antitrust law, if done by a domestic company (such as dumping, or buying a competitor) tariffs may be the only way to practically address the issue.
Open, free, fair trade is preferable in all cases, if possible. Other than the exceptions I listed, I only support tariffs to get us to that ideal.
Pfft. Hopefully, when globalist like you die off the USA can get back to self sufficiency ASAP. But it looks like for the foreseeable future the GOP is in the hands of a tiny minority of radical greedy free traders. BTW IMO free traders are not patriots. To be a patriot you must be a nationalist. To be a Nationalist you must be for protective import tariffs and against offshoring of any kind.
Okay...
“If factory workers in Mexico are making more, then I think thats great. A better the Mexican economy is a plus for them and us, too.”
Excellent comment.
Well then tell them good luck with China. Remove all troops and carriers.
I didn’t know we were crying ike b****** about things we supported only last week.
I didn’t know one article was all it took to break people around here
I think it’s great that you post so many articles but every now and then have the courage to take a stand on something you post that kind of takes a slam at Trump. I have no problem with that. We should be looking at both sides of an argument but at least have the courage to leave a remark saying so. When I disagree with Trump I say I disagree with Trump.
This better than posting an article and running
Should we notify someone to check on you?
Number of Asian Auto Factories in the U.S.
Toyota - 4
Honda - 4
Nissan - 2
Subaru - 1
Mazda - 1 (opens 2021)
Hyundai - 1
Kia - 1
Hino - 1
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.