The current economic climate is very bad and all car manufacturing in the USA has declined in the last 2 years. But the longer term trend is that foreign companies are manufacturing more and more here while the USA companies fail to. This year it is likely the “big three” will manufacture fewer than 50% of the cars manufactured in the USA (the “big three” have more production in Canada and Mexico than the “foreign” companies do).
They Can Build Them; Why Can’t We?
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This transplant industry is replacing Detroit’s manufacturing. Through mid May, all North American assembly plants (including Canada and Mexico) have built 2.77 million cars and light trucks, half the production level of the year-earlier period. Of these, Detroit’s Big Three have built only 1.5 million of these vehicles, just 268,000 more than the transplants.
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Toyota took over a badly managed GM plant in California; it was a joint venture, but the Japanese ran the plant. GM sent young executives to work there and learn Toyota’s manufacturing and quality techniques. They learned, but when they came back to GM, the GM bureaucracy would not change its ways.
Read about the joint Toyota – GM plant: Remembering NUMMI. The problems of GM, Ford and Chrysler are due mainly to long term failures or management. It is not impossible to manufacture in the USA. But it is difficult to maintain poor management systems, without overpaid executives when others manage better and don’t take so much of the profits into their own pockets.
Related: posts on manufacturing – Big Failed Three, Meet the Successful Eight – Leading Manufacturing Countries in 2007 – Honda has Never had Layoffs and has been Profitable Every Year – People: Team Members or Costs