Michigan grasping for every auto job
7/17/05, 01:03 PM
#1
I Have Admin Envy
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KATHY BARKS HOFFMAN
LANSING, Mich. (AP) - Ever since the first Model Ts rolled off Henry Ford's assembly line, Detroit and its surroundings have been the capital of the U.S. auto industry. But now, thanks to less expensive health care and changing tastes in cars, its Canadian neighbour is challenging it for the title of North America's top producer.
Michigan last year built 2.6 million Chevrolet Silverados, Ford Mustangs, Jeep Grand Cherokees and a host of other models. But that wasn't enough to hold off Ontario, long a car-building centre but largely in Detroit's shadow. Ontario produced nearly 103,000 more vehicles than Michigan last year.
Model changeovers - which forced Michigan plants to close for part of 2004 to retool for new models - are partly to blame, according to WardsAuto.com, which tracks industry trends. But there are more complicated factors at play, such as health-care costs and chronic market-share declines for Detroit's Big Three automakers, experts say.
General Motors Corp., Ford Motor Co. and DaimlerChrysler AG's Chrysler Group have shed thousands of jobs and closed U.S. plants to remain competitive while foreign automakers have beefed up operations in Ontario.
"If it was Ford gaining at the expense of GM, it wouldn't matter," said Thomas Klier, senior economist with the Federal Reserve Bank of Chicago. But it's companies such as Toyota and Honda that are growing, he said, and they're growing outside Michigan.
"It comes down to geography," said Klier.
Even in Canada, the Big Three face issues with unionized workers that their non-union foreign competitors largely sidestep. GM, Ford and Chrysler hope during talks beginning this week that they'll be able to negotiate new contracts with the Canadian Auto Workers that will help them trim costs.
But CAW president Buzz Hargrove already has told his members the CAW won't accept cuts in the growth in wages, benefits and pensions.
No such problems plague Toyota, which two weeks ago announced it will open an $800-million-Cdn assembly plant by 2007 in Woodstock, Ont., to build up to 100,000 small sport utility vehicles a year.
Skyrocketing U.S. health-care bills, which the Big Three cite as one of their biggest obstacles in competing with foreign automakers, are another factor.
Canada's public medicare system subsidizes much of workers' health-care tabs, said Jim Donaldson, vice-president for business development at the Michigan Economic Development Corp. He noted health-care expenses for GM's current and retired U.S. workers add about $1,700 to every vehicle it makes.
"If all other costs are similar, that would be one of the things that would favour building in Canada," Donaldson said.
Ontario's success also is tied to a $400-million fund the province created to attract automotive projects. In the past year alone, Ford, GM, Toyota and others have committed to $5 billion in new investments in the province.
Ontario also is working hard to attract more research and development and has established a new engineering degree specifically for the automotive field.
"We're trying to put our auto sector on the most competitive footing for the next generation of products and the next generation of worker education," said Joseph Cordiano, Ontario's minister of economic development and trade.
Michigan already touts a concentration of auto-related businesses, a well-trained workforce and an education system set up to turn out automotive engineers, materials specialists and designers and to train workers for sophisticated manufacturing jobs.
The state has created a strategy that includes attracting international automotive investment and helping domestic companies develop international business strategies.
And for the moment, Michigan has regained the lead over Ontario in motor-vehicle manufacturing. But WardsAuto.com expects Ontario to retake the title in the next few years.
Still, Michigan has its success stories. GM next year will open a new assembly plant west of Lansing that will employ up to 3,000 workers. And DaimlerChrysler this fall will begin making a new generation of four-cylinder engines in Dundee, southwest of Detroit.
Despite the fierce competition, Ontario and Michigan officials say they're happier to see new auto-related work go to each other than to states in the U.S. South because it lifts the region's overall economy.
"We are our biggest trading partners and each other's biggest allies," Cordiano said. "We never forget that."
A look at the top North American vehicle-producing states and provinces. Figures include actual production in 2004 and projected production for 2008, all numbers in thousands.
2004
1. Ontario 2,701.2
2. Michigan 2,598.4
3. Ohio 1,818.5
4. Missouri 1,226.3
5. Kentucky 1,162.8
6. Indiana 772.6
7. Tennessee 713.8
8. Coahuila, Mexico 410.4
9. Illinois 396.8
10. Georgia 395.7
Other 4,027.4
Total 16,224.0
2008
1. Ontario 3,058.9
2. Michigan 2,433.6
3. Ohio 1,814.5
4. Kentucky 1,183.9
5. Missouri 970.1
6. Indiana 768.4
7. Alabama 751.4
8. Tennessee 684.8
9. Illinois 530.5
10. Puebla, Mexico 434.4
Other 4,353.1
Total 16,983.6
LANSING, Mich. (AP) - Ever since the first Model Ts rolled off Henry Ford's assembly line, Detroit and its surroundings have been the capital of the U.S. auto industry. But now, thanks to less expensive health care and changing tastes in cars, its Canadian neighbour is challenging it for the title of North America's top producer.
Michigan last year built 2.6 million Chevrolet Silverados, Ford Mustangs, Jeep Grand Cherokees and a host of other models. But that wasn't enough to hold off Ontario, long a car-building centre but largely in Detroit's shadow. Ontario produced nearly 103,000 more vehicles than Michigan last year.
Model changeovers - which forced Michigan plants to close for part of 2004 to retool for new models - are partly to blame, according to WardsAuto.com, which tracks industry trends. But there are more complicated factors at play, such as health-care costs and chronic market-share declines for Detroit's Big Three automakers, experts say.
General Motors Corp., Ford Motor Co. and DaimlerChrysler AG's Chrysler Group have shed thousands of jobs and closed U.S. plants to remain competitive while foreign automakers have beefed up operations in Ontario.
"If it was Ford gaining at the expense of GM, it wouldn't matter," said Thomas Klier, senior economist with the Federal Reserve Bank of Chicago. But it's companies such as Toyota and Honda that are growing, he said, and they're growing outside Michigan.
"It comes down to geography," said Klier.
Even in Canada, the Big Three face issues with unionized workers that their non-union foreign competitors largely sidestep. GM, Ford and Chrysler hope during talks beginning this week that they'll be able to negotiate new contracts with the Canadian Auto Workers that will help them trim costs.
But CAW president Buzz Hargrove already has told his members the CAW won't accept cuts in the growth in wages, benefits and pensions.
No such problems plague Toyota, which two weeks ago announced it will open an $800-million-Cdn assembly plant by 2007 in Woodstock, Ont., to build up to 100,000 small sport utility vehicles a year.
Skyrocketing U.S. health-care bills, which the Big Three cite as one of their biggest obstacles in competing with foreign automakers, are another factor.
Canada's public medicare system subsidizes much of workers' health-care tabs, said Jim Donaldson, vice-president for business development at the Michigan Economic Development Corp. He noted health-care expenses for GM's current and retired U.S. workers add about $1,700 to every vehicle it makes.
"If all other costs are similar, that would be one of the things that would favour building in Canada," Donaldson said.
Ontario's success also is tied to a $400-million fund the province created to attract automotive projects. In the past year alone, Ford, GM, Toyota and others have committed to $5 billion in new investments in the province.
Ontario also is working hard to attract more research and development and has established a new engineering degree specifically for the automotive field.
"We're trying to put our auto sector on the most competitive footing for the next generation of products and the next generation of worker education," said Joseph Cordiano, Ontario's minister of economic development and trade.
Michigan already touts a concentration of auto-related businesses, a well-trained workforce and an education system set up to turn out automotive engineers, materials specialists and designers and to train workers for sophisticated manufacturing jobs.
The state has created a strategy that includes attracting international automotive investment and helping domestic companies develop international business strategies.
And for the moment, Michigan has regained the lead over Ontario in motor-vehicle manufacturing. But WardsAuto.com expects Ontario to retake the title in the next few years.
Still, Michigan has its success stories. GM next year will open a new assembly plant west of Lansing that will employ up to 3,000 workers. And DaimlerChrysler this fall will begin making a new generation of four-cylinder engines in Dundee, southwest of Detroit.
Despite the fierce competition, Ontario and Michigan officials say they're happier to see new auto-related work go to each other than to states in the U.S. South because it lifts the region's overall economy.
"We are our biggest trading partners and each other's biggest allies," Cordiano said. "We never forget that."
A look at the top North American vehicle-producing states and provinces. Figures include actual production in 2004 and projected production for 2008, all numbers in thousands.
2004
1. Ontario 2,701.2
2. Michigan 2,598.4
3. Ohio 1,818.5
4. Missouri 1,226.3
5. Kentucky 1,162.8
6. Indiana 772.6
7. Tennessee 713.8
8. Coahuila, Mexico 410.4
9. Illinois 396.8
10. Georgia 395.7
Other 4,027.4
Total 16,224.0
2008
1. Ontario 3,058.9
2. Michigan 2,433.6
3. Ohio 1,814.5
4. Kentucky 1,183.9
5. Missouri 970.1
6. Indiana 768.4
7. Alabama 751.4
8. Tennessee 684.8
9. Illinois 530.5
10. Puebla, Mexico 434.4
Other 4,353.1
Total 16,983.6
7/18/05, 06:58 AM
#4
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Business is business. Unfortunatley in today's world for the common worker, the company must do what it has to do. If this will give Ford a better profit then it has my blessing.
10/31/07, 06:19 PM
#5
Ford is still Ford where ever it is at is it not ? I am Canadian and I'm pround my unit was built in Michigan and they did a sweet job to and this is my second factory order from same place ! Both my 05 GT and 07 GT/CS are the bomb 
What's with the thumbs down here ? I didn't do it
What's with the thumbs down here ? I didn't do it
10/31/07, 06:48 PM
#6
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As long as the automaker makes it's primary home in North America I'm ok with a Canadian built car. Heck, My 96 Camaro was built in St. Therese Quebec along with all the other GM F Bodies from 93 to 2002.
I feel a sense of pride that my new 08 GT is a brand new Domestic car. I feel an equal sense of shame when I see a brand new import. Especially when they paid more for less! I don't care if Toyota and Mazda have plants in the U.S. I'm glad our folks get work but I don't like where all the money ultimately goes. The only reason the foreign makes put plants here was to get out of paying import duties. Global economies are fine but not at the price of one countries economic health for another.
I feel a sense of pride that my new 08 GT is a brand new Domestic car. I feel an equal sense of shame when I see a brand new import. Especially when they paid more for less! I don't care if Toyota and Mazda have plants in the U.S. I'm glad our folks get work but I don't like where all the money ultimately goes. The only reason the foreign makes put plants here was to get out of paying import duties. Global economies are fine but not at the price of one countries economic health for another.
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