The outsourcing of all things manufacturing from the United States to China is now, virtually, complete. All things from clothing to electronics have been produced in China and shipped to the mighty consumer, the U.S., for years now. Wasn’t it a matter of time before the same was true for automobiles?
Both General Motors and Chrysler are looking to cut cost in just about every way possible. The major focus in the press has been labor. You know, the whole “how can an American car manufacturer stay competitive if it costs $123 per hour to build a car in the US, but a German manufacturer can assemble a car for $4.35 per our in Mexico” thing… (yea, numbers are pulled right from my armpit, thank you.)
While having no specific information to cite, I would make the assumption this has not happened in the past due to a number of factors, the biggest being Union Contracts and trade agreements. The economic chaos experienced by the United States in the fall of 2008 and Early 2009 seems to have changed all of that.
General Motors plans to sell cars in the United States that it makes in China, starting in 2011. That could make GM the first major automaker to import Chinese cars to the US market.
The carmaker expects to sell about 17,335 of the China-made vehicles in the US in 2011, and triple that number to 51,546 in 2014, a planning document circulated by GM among US lawmakers showed.
The gains would come, the document says, as GM’s total US sales surge 50 per cent in the next five years.
The plans are subject to change pending the outcome of negotiations with United Auto Workers (UAW).
Put aside any anti-China business emotions for a moment. To me, this very concept seems to make business sense. If the company had the ability to manufacturer a quality product at a lower cost, why wouldn’t GM or Chrysler make such a move? Isn’t such flexibility the key to survival in business?
One can make the argument that such a move will place American workers on the unemployment line, and they very well may be correct in saying so, but where does the responsibility of the company sit? Is it to the line worker or is it to the survival of the company?
I would also look at the importing of American branded, Chinese manufacture cars, as a test balloon for Chinese manufactures. If the U.S. consumer is willing to purchase a U.S car produced in China, why wouldn’t the U.S. consumer be willing to purchase a Chinese car produced in China?
I think this whole situation is opening up a wide rage possibilities for the Chinese manufacturing sector. Even more than may have existed today…
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