Buying American Cars What Does It Mean?

andre1969 · October 2010

When did you last travel by train? Outside of the BosWash corridor, intercity train travel in the U.S. is nearly non-existent. When my parents traveled from their home in the Northeast to visit family in the Upper Midwest in the early 50s, they traveled by train. When they made the same trip 10 years later, they flew.

A few years ago, one of my roommates was going to take the train back to visit relatives near Detroit. It was on a day where I was leaving to go up for one of my car shows in Carlisle, PA, and the train that left Union Station was at a bad time for me. So, we checked Amtrak's schedule to see if there was anything going out of Baltimore. There was, but it was the same damn train! It just stopping in Baltimore first, and then went down to DC. So, we tried Harrisburg. Same train again...just stopping in H-burg birst, before going town to Baltimore! What is this, Amtrak or the Hooterville Cannonball?!

In the end, he took a plane.

As for me, the last time I rode a train was at Dorney Park and Wildwater Kingdom in Allentown, PA a few months ago. Before that, it was Cedar Point in Ohio. Oh, a "real" train? I remember as a kid once, in the late 70s, Dad took me out to Harper's Ferry, WVA, by train. Only time I've ever been on a "real" train (not counting amusement parks, DC Metro, Baltimore Light rail, etc)

As for passenger cars and locomotives, there may not be as much demand on the people-moving front, but for freight, I'm sure there's still a lot of demand. Although I imagine those freight cars pretty much last forever, and get refurbished rather than replaced, unless they're in a really serious accident.

fintail · October 2010

Don't despair, lemko - it is just a matter of time before a new miracle industry pops up that the treacherous casino capitalists can't offshore, and it will save the day - every day that we deal with this malaise is just a day closer to the rebirth. You believe that, right? We certainly are not racing to the bottom, I know that much. A banana republic style socio-economic gap and a slaughtered industrial base are signs of a glorious society, a Dickensian labor picture and a new gilded age brought on by 21st century robber barons can only bring good for everyone. We all need to bow to the great minds of people like von Mises and Rand, their thoughts and their fanboys know the way forward. We should also pay homage to heroes like Nixon and Kissinger for doing so much work to enable this progress and justice as well.

South Korea must have the quite the domestic demand and infrastructure to be able to have such a competitive railcar building industry. It is a huge country with a massive population, so that must be the case. It certainly couldn't be because their leadership - both private and public - actually values where they come from above raw unsustainable profits generated by offshoring via "free trade" and "free markets" - terms I would never claim are almost oxymoronic.

Notice the progress being made by serial exporters these days vs serial importers and false policemen of the world.

stever · October 2010

My former neighbors drove to Ogden last summer, and for ~$600 all four got on the train and went to Iowa. Rented a car and drove another hour to visit family. They didn't much enjoy it and almost flew back home but what the hey, $600 RT was cheap. Would have been a lot better had they sprung for a berth.

lemko · October 2010

You've got to check out this comic-book style commentary on our current economic condition called "Unemployed Man." It's presented in a superhero format and pretty much explains it all!

The Adventures of Unemployed Man

fintail · October 2010

Bah, that's nothing but classist propaganda!

The Outsourcerer and the Free Marketeers...I love it.

If Unemployed Man won't work for the same pay and benefits as someone in Lesotho or Myanmar - no matter how he does his job, he doesn't deserve to have a job.

andre1969 · October 2010

I remember a few years ago, my roommate did take the train back to Michigan. Well, Toledo, actually, and then some friends met him and drove him the rest of the way. It took around 12-13 hours to get to Toledo. If you wanted to take the train all the way, it goes out to Chicago first, and then you have to catch another train that doubles back to Detroit! I think the bumps up the trip time to about 24 hours.

When he's flown, I think I'd drop him off at BWI airport around 7 in the morning, and he'd be out in Detroit, have his luggage with him, and be meeting his friends or family about 3 hours later.

stever · October 2010

I heard horror stories like that and I warned my friend not to be surprised if they rolled into the last station hours late.

But coming and going, they were pretty much on time. Maybe being mostly a direct route helped.

My mom grew up in South Mississippi and could catch a train 2 hours south to New Orleans a couple of times a day. My mother-in-law grew up in the Midwest and see could get to Chicago easily enough, and that was more like 6 or 8 hours iirc. It can be a nice way to travel if you could do it European style - compartments, easy to walk between cars, easy to sleep in the coach section and separate lines for the passenger trains so you could enjoy reliable service.

But people started buying American cars and quit traveling by rail (hey, a segue to the topic

).

bumpy · October 2010

Although I imagine those freight cars pretty much last forever, and get refurbished rather than replaced, unless they're in a really serious accident.

There is a federally-mandated 50-year service limit, though there is some occasional talk of extending that in some cases. However, the stuff built in 1960 is largely obsolete in size and weight capacity these days anyway.

uplanderguy · November 2010

Forgive me if anyone's posted this, but it's pretty complimentary to the Volt and GM's thinking on it:

http://online.wsj.com/article/SB10001424052702304510704575562363168727230.html?K- EYWORDS=cars

verdi942 · November 2010

+1, bumpy; thanks for the link. Despite what so many people say, the D3 are world-class competitive once again.

cooterbfd · November 2010

"....Trying to put factual dates into the discussion here. "

I think they may have been implying that it hasn't been relevant in 50 years.

cooterbfd · November 2010

Hey, Andy, don't forget the oldest continuous train service in the country, the Strasburg RR, with daily roundtrip service to Paradise (Pa., that is)!!!

imidazol97 · November 2010

>the Strasburg RR, with daily roundtrip service to Paradise

Been there. Ridden that one. Smoke and all!

cooterbfd · November 2010

".....Let's face it...Philly has absolutely nothing that some other city cannot offer, probably cheaper, better, and a better climate to boot...well, nothing except lemko, of course...and his fleet... "

Bob, I think lemko's bigger point is lamenting the loss of American manufacturing to other countries. Sure, Philly may be corrupt,have large crime rates, and be expensive to live, but moving to Georgia isn't good enough for greedy CEO's. They want the BRIC countries (Brazil, Russia, China, and India) for their cheaper than cheap labor. Worst part is, this country ENCOURAGES it!!!

We complain about the 25% tax being slapped on Mahindra for importing it's little diesel pickup (poor Mahindra, tsk tsk), But if Caterpillar wanted to export equipment there, India "protects" Mahindra with a 100% IMPORT DUTY on them!!! How could we possibly compete with that???

berri · November 2010

"We complain about the 25% tax being slapped on Mahindra for importing it's little diesel pickup (poor Mahindra, tsk tsk), But if Caterpillar wanted to export equipment there, India "protects" Mahindra with a 100% IMPORT DUTY on them!!! How could we possibly compete with that???"

I think you hit on my biggest beef. We get cheated on most of these trade agreement deals. I think the US is afraid it will come off as a bully and so it negotiates weakly.

andres3 · November 2010

I have had my Audi since April 2006 and it is approaching 70K miles very soon.

I have yet to require a tow trucks services due to the car. I have only had to make 2 repairs that cost me money and both were minor.

Going by tow truck hookup requirements, the score is still:

Japanese 0 German 0 USA 4

And like golf, in this scoring system it's preferable to have the lower score.

lemko · November 2010

You won't make poverty decrease by making the middle class poorer and reducing their ranks. All that does is shut out opportunity for the poor to elevate. I just don't understand why the present political class doesn't understand this. The middle class is the only place poor people can go to get out of poverty. Forced wealth redistribution hasn't worked--it's been tried and it's failed. The solution is to boost the National Income.

The best cure for poverty is jobs and employment. To have employment, the National Income must increase. That means free trade agreements need to be scrapped and re-written so investors and exporters must pay a hard price for exporting production and wealth away from American families. Offshoring production and outsourcing jobs must come at a price that makes up for the loss of national income and tax revenue that would have been generated had the production and jobs been located here.

We must reposition all of our trade relationships so the overall trade balance is ZERO. All of our trade deficits and trade surpluses should balance out---which is what the "Invisible Hand" of economics tries to do. The prices we are paying now, with joblessness, is a result of our greed and our unwillingness in BOTH political parties to correct our trading relationships so they make the most economic sense for us and produce a positive outcome for all of us.

marsha7 · November 2010

"Bob, I think lemko's bigger point is lamenting the loss of American manufacturing to other countries."

I do get it, really...but I often wonder if the job loss from the highly unionized states of the north is overall greater than the nonunionized south...I think it is factual to say that the unionized north succeeded in getting wages paid to unskilled workers far in excess of their inherent value, and that, IMO, could accelerate the movement of plants to other countries to avoid higher labor costs and the insanely restrictive work rules imposed by unions...between ridiculous wages, restrictive work rules, and extended grievance processes just to get rid of "bad apple" employees, why would ANY company stay in a unionized region of the country...what logical CEO would tolerate that crap from illiterate workers who are often a dime a dozen to replace???...give ONE reason to stay, leaving all emotion out of it...

cooterbfd · November 2010

"........I think it is factual to say that the unionized north succeeded in getting wages paid to unskilled workers far in excess of their inherent value, and that, IMO, could accelerate the movement of plants to other countries to avoid higher labor costs and the insanely restrictive work rules imposed by unions..."

I disagree. 50-70 yrs ago, they were making "normal" wages. As time went on, and new contracts were negotiated, the unionized would keep getting pay raises, where non union plants may have had to forgo a raise for a year or two at a time. Over time, I suppose a unionized worker up north could be making 50% more in wages than a non union worker in the South, but that is a gap that has manifested itself over many years. Not to mention any higher cost of living associated with living up here.

Anyhow, I still think that it is impossible for us to keep up with these countries even if you could get Americans to work for $5/hr today. There would be companies that would still want the "valsu" of paying people pennies an hr in these other countries.

verdi942 · November 2010

There are other factors in plant auto location - closeness to markets; currency differences; the fact that assembly labor is only [!] about 15% of the cost of producing a car; government incentives and regulations, etc. Didn't BMW just start a new US plant, only partly because our labor costs were less than those in Germany [where NO local jobs were reported lost]?

stever · November 2010

"In the weeks ahead, a 104-year-old unit of General Motors will be sold to new owners from China. The unit made steering equipment for decades under the name Saginaw Steering Gear. Now known as Nexteer, it employs 8,300 people around the world. Its new Beijing owners call themselves Pacific Century Motors."

"I'm sure there are a lot of people who are not happy they're Chinese-owned," says Scott Somers, who runs Mid-States Bolt & Screw just down the road from Nexteer, which is a customer. "But at this point it seems to be a positive thing. Lots of businesses are involved with that complex and depend on it for their livelihood."

Wall St. Journal (subscription link but the story may be around elsewhere).

carnaught · November 2010

I'm sure there are a lot of people who are not happy they're Chinese-owned.

Yea, how do you think Volvo feels?

lemko · November 2010

Congress seems to be OK with it!

verdi942 · November 2010

So, the jobs are staying here? How is this any worse than a Toyota assembly plant here? Of course, the profits, from the increased business a newly revived US auto industry should bring in will go to the new Chinese owners.

stever · November 2010

So, the jobs are staying here?

That's the $64 million dollar trade deficit question. Nexteer has Saginaw, 22 factories around the world and 20 other centers. Only Saginaw and an Arizona factory are in the US.

So who's to say the new owners won't take the tech (really, the patents), and close down the US stuff in a year or three?

From the Journal article:

"The U.S. was built on foreign investment for centuries, reminds Dewey & LeBoeuf attorney Alan Wolff, a former U.S. trade negotiator. "And we should bolster any investment that encourages U.S. manufacturing, including from China. We'd rather build it here than there."

Let's hope the new owners feel encouraged to stay.

marsha7 · November 2010

plant staffed by the UAW???...if it is, I can see the Chinese putting up with their crap about 2 minutes, shutting down the plant, and moving everything to Peking (old spelling...no one ever explained to me why it changed years ago to Beijing...anybody know???)...I can just see the UAW going on strike, and then, while picketing outside, watch the Chinese demolish the plant and hand the broken bricks to the striking members...rest assured, if the UAW is involved, they will act like children and screw it up for themselves...they always do...

fintail · November 2010

That's why the new owners are new owners - the patents. It works better than making cheap defective copies.

With all due respect to Alan Wolff, I am trying to think of how the US was "built" on foreign nationals buying domestic industry.

Opening China and then allowing it to operate as the world's trade (among other traits) criminal, greatest mistake of modern history.

verdi942 · November 2010

Well, yes, since at least the Civil War, foreign investment helped build our railroads [the hot thing of the day] and much of our industry. As in bonds and stock. That inflow of capital continues to this day, and not just from China. Sometimes they buy a Saginaw, other times they get a piece of a new venture. Bottom line for most of us - do we gain or lose jobs here in the USA? The problem today is, what will our economy look like in the decades ahead? Will we ever see a return of the huge, prosperous middle class like we saw in the 50 years after WWII?

circlew · November 2010

That's what you get when you spend taxpayer money to support a dead brand....the foreigners pick up the dead ends.

Like it or not. GM is NOT ALL AMERICAN.

Actually, no car brand is. Sign of the times.

Regards,
OW

fezo · November 2010

and moving everything to Peking (old spelling...no one ever explained to me why it changed years ago to Beijing...anybody know???

I don't remember the specifics but essentially there is a whole different method for doing the translating. The languages don't translate well. Peking isn't the only one. What was Canton is now Guangzhou. The province of Canto in Guandong. All sorts of wackiness.

iwant12 · November 2010

The problem today is, what will our economy look like in the decades ahead?

"Who will be our master(s)?" is what I thought as I was reading this.

fezo · November 2010

Bob -

A little more on Peking becoming Beijing.

I'm kid of surprised I haven't found a better site but I'm feeling lousy today so maybe I'm not trying so hard.

fintail · November 2010

Well, I don't know if selling stocks and bonds is the same as selling physical and intellectual capital - but then again, the claim was made by a lawyer, so it has to be right :shades:

There's no room for a middle class in a globalized corporatized world.

marsha7 · November 2010

Well, thanks...who'd a thunk that someone would write a small discourse, just waiting for an innocent sap like me to ask the question...and...voila...the internet, and fezo, supply me with the answer...

And I did not stop to realize that Shanghai was still Shanghai...

cannon3 · November 2010

And yet another reason to demand American goods and services. On tonight national news (CBS) there was a excerpt about President Obama in South Korea. How he wants to level the playing field on trade with South Korea. South Korea shipped over 735,000 vehicles here to the U.S. last year. All the American car companies combined shipped just over 6,000 vehicles to South Korea!!!!!! This because of all the restrictions/taxes/tariffs and you name it that make U.S. vehicles too expensive for the general public. NOT because the South Korean people don't want them either. This information needs to get out to the masses here in the U.S. Educate people on what they are buying and from whom. :mad:

jimbres · November 2010

South Korea shipped over 735,000 vehicles here to the U.S. last year.

Does this number include Korean brands assembled in U.S. plants?

This because of all the restrictions/taxes/tariffs and you name it that make U.S. vehicles too expensive for the general public. NOT because the South Korean people don't want them either.

How do you know this? Can you furnish links?

motorcity6 · November 2010

Saginaw Steering Gear as it was known back in the old days when it was 25% of my plant's business..1973-1980..Great customer for compression springs, rings, small stampings, and wireforms..

I agree that the Chinese will strip the plants to the utilize the assembly process only, and relocate all manufacturing operations..Look at Flint, AC & Buick are gone, couple GM stamping plants left and maybe a truck assy operation. Michigan has been gutted and the next slice is coming..

The Chinese have most of our greenbacks so I guess it's their move with our $$$$.
Just keep the printing press running, and watch the country go down the tube. I will avoid any political talk as I have been chastised for my past opinions..

Spent from 1968-2002 in the auto supplier world employed by small metal-processing operations in positions of VP of Sales/Marketing, VP of Operations, and my favorite final title was "self-employed commissioned manufacturers rep" which was the last 13 yrs..I called it the "gravy train" time, selling hot and cold forgings along with shell-cast steel casting to the auto and military..Did serve time with a transplanted Japanese manufacturer as VP Sales/marketing, no fun with them, only lasted a couple years, kinda cheap and boring to put up with their work ethics..

Yep, having gone through ownership of 53 cars to date, all Big3 except the 2 Porsches, if you want to buy an Asian nameplate, please step up to the plate and do so, make yourself happy and proud, after all they are assembled here in new assembly plants made possible with your Tax $$$$$..My favorite cheap end foreign nameplate is a Camry SE V-6, but my love affair with my supercharged V-6 Pontiac and my Mustang GT will probably last until my D-Day.

The USA auto industry was a fun place for many years cranking out great cars, along with some real loony ones, however I hope you young and middle aged enjoy the "green movement" and the shear excitement of hybrids and electric-powered 40 mile range items called "saving the Planet." You will have your DroidXs or Iphone4 to get you through the day without actually seeing anyone in person..Doesn't sound too exciting??????????????? America had a great run and I enjoyed the excesses!!!!!!!!!!!!!!!!!!!!!!!!

cannon3 · November 2010

This figure comes from CBS news. 735,000 vehicles shipped from South Korea to the United States. American car companies sold only just over 6,000 vehicles due to the high costs the Korean government slaps on them. If you type in South Korean trade imbalance, or South Korean trade with United States Plenty of information comes up on Google. As far as trying to justify the transplants, this is only going to last so long. Americans are finally getting smarter in learning that most of the tooling, support, spare parts, technical knowledge comes from the country of origin. Even the Sonata that is touted as "American" is only 43% U.S. content. We are dumb as a nation for allowing this to happen and continue to happen to us. For me, I will not ever buy a Korean vehicle until they allow FAIR trade.

circlew · November 2010

Hmmm, South Korea population = 46 million.

USA population = 310 million.

%of Korean cars spread across USA population = .2%
% of American cars spread across South Korean population = .1%

Get real. Just double US auto exports to 12,000 and get over it.

Regards,
OW

motorcity6 · November 2010

Somebody from our current administration is spending 10 days traveling thru Asia, hyping the upcoming GM stock offering, just a side benefit of our system to help the UAW coffers, and placate the Chinese financial guys..China will own GM very soon, and I think the Italians are in charge at Chrysler..Ford is going to be the sole survivor for the time being, however, politically they will get waylaid somewhere to make the threesome all foreign-owned..

We are very familiar with the term "real estate foreclosure" for the it is talked about daily and it's devastating effects on the American lifestyle..high unemployment,and blah,blah, etc...

How about the "foreclosure of America" and stop worrying about foreign cars because they will all be foreign labeled..Didn't Emmelt, CEO of GE last week commit his corporation to buying 15,000 to 20,000 Chevy Volts, that's right he is traveling thru Asia on the coattails of our leader..Wow, must be a great car!!!! that nobody wants, however our GE CEO is repaying his debt for the "bailout money" that GE needed back in 2009..Great timing in light of the stock offering...The Volt is a huge taxpayer financed "dud", and the Cruze will be the shining star, 42mpgs on the internal combustion engine,,,,no plugin, 1 battery, not too green, and I believe it is being made at the Lordstown, Ohio plt, which if memory serves me right was the birthplace of the "Vega." I supplied the inside "hood release assy" for this beauty, and another GM star called "Chevelle." Both GM standouts???? Ha-Ha

Our country is operating under a "Shadow." and you won't know anything until it happens. Gee, Hope I am wrong!!!!!

To the UAW, they owe their popularity to our elected officials and if one operated in Michigan during the "glory days" close to Flint and Saginaw, one did fall under the eye of the UAW.. I ran a plt 15 miles from Flint, yep it was organized by the UAW , 2yrs before I arrived, however we ran the operation, they didn't....THis location was shutdown down during the mid-80s, business was transferred to a non-union plt in N.Illinois, along with our UAW plt in Milwaukee..Our non-union plt paid higher wages than the organized ones..conclusion: the Big3 gave away the store and the right to operate their plants..very simple...Our Milwaukee plt took a strike in the early 70's and 90 days later the UAW was de-certified..This 3 plant operation was owned by a family which later sold on a leveraged buy-out to a Wall Street..

The American auto industry is all but dead, and when the oil prices rise this winter to $4+++/gal, it will decimate what's left..GM has Chevrolet with a small ecomony car, the rest of the divisions are plagued with 2-ton cars/trucks/suvs which guzzle gas..Buick has a 2 ton car powered by a wenny-4banger which is rated @32 hwy, going downhill..

The Asians have lots of teeny-weeny cars in production that get 35+++and warranted for a lifetime..Funny names and boxy shapes, dirt cheap, and assembled anywhere on the globe for your enjoyment..

Sorry most of you missed the great automotive days of the past, for it was a 'blast." Careful crossing the street, those "silent cars" powered by fossil-fuel generated electricity are "stealthy."

cannon3 · November 2010

circlew, first of all I will not "get over it". Are you really that blind to see past the now? Can you really not envision your future? your childrens future? This is what is wrong with Americans these days. We are unable to see longterm in our choices. We want everything now and for a cheap price. Not seeing the true price of our choices. We are all connected in this economy, and when we realize this is when real change will happen.

Motorcity - I am not one for giving up myself. I believe in America, its manufacturing base, engineers, technical know how. The U.S. auto industry is not dead. GM is rebuilding itself. I guess you missed the news on their last profits/income. Ford is also digging itself out of debt and putting out some great product. We must stop this trade imbalance that threatens this very countries existence. Demand made in the U.S. products and services. If you can think past the now, you will understand.

cooterbfd · November 2010

Good for you Cannon!!!

We can talk all we want about the mismanagement at the Big 3, restrictive UAW work rules (which, BTW management agreed to), poor quality, etc., but the fact remains that America CAN'T survive making (printing) money or making money off of money, but from making money off of goods and services. I'm not saying that healthy economies elsewhere are bad for the US, they clearly are a GOOD thing, but the USA CAN'T be the leading exporter of jobs to other countries.

greg128 · November 2010

I agree 100%

In the words of Pogo: "We have met the enemy..it is us!"

Our government must take measures that are in the interest of
this country and it's people. I think the time is right for tariffs
on imported products, The Asian and German transplants would
only be taxed on parts and assemblies that are imported, including
from Mexico and Canada. Sure other countries would retaliate with
their own tariffs, but when you realize that the trade imbalance with
China alone this year will be over 1/4 of a trillion dollars, how
can that hurt us?

Sure prices will go up but at least the money would stay here
employing our own people. While we're at it lets develop our own
energy resources, which are plentiful. A tariff on foreign oil would not
be popular but if we are allowed, we would find our own supplies in
a hurry.

Oh, and the money from the tariffs could be used to lower the budget
deficit - and without raising taxes. And yes, the tariffs would be like a
tax...but a voluntary tax you only pay to the government if and when
you buy imports.

jimbres · November 2010

I think the time is right for tariffs on imported products,

Tariffs hurt more than they help. They're a sneaky backdoor sales tax, & like any sales tax, they hurt lower income families the most. Think about it: a family making $250K per year doesn't spend 5 times as much as a family making $50K per year. Tariffs will cost the poorer family a proportionately larger share of its income.

Moreover, tariffs help a few industries at the expense of others. If I'm paying more for my car, I have less money to spend on other things made by Americans. Sure, I'd like to see the Michigan auto worker keep his job, but I don't live in Michigan. I'd rather spend that extra money on things made by workers in my own state - even if that costs the Michigan worker his job. I want to support local industries - not workers 5 states away. Tariffs take that choice away from me.

My position on tariffs is simple: companies that make what I want at a price that I'm willing to pay don't need tariff protection. Companies that can't do this don't deserve tariff protection.

cannon3 · November 2010

What will bring jobs/companies back to the U.S.? What is your feeling on this?
I am also not in favor of unions. Having experienced the entitlement attitude unions foster, not for me. I want to be paid on what I am worth, what I am able to contribute to an organization. If company A is not paying me for what I think I am worth, I find a company that will. This is the beauty of America, find another job. UAW is a dying organization. Making cars/trucks is no longer a highly skilled job. With automation and new production technologies/techniques labor is labor. This is what is called manufacturing evolution. I am all for free trade and FAIR trade. I am willing to go head to head in competition IF the competition is FAIR. I cannot compete with Hong Lo in China that has the same skills I do, yet is willing to work for $1 an hour with no health/dental/vision or retirement benefits. This is where tariffs and taxes of imports evens the playing field.

jimbres · November 2010

This is where tariffs and taxes of imports evens the playing field.

Sorry, but whenever I see the phrase "evens the playing field", I reach for my wallet because I know that someone wants to help himself to my money without working for it.

Look at Ford, which employs tens of thousands of American workers & turns a significant profit for its shareholders without tariff protection. If, as some want us to believe, the problem is unfair foreign competition & the only solution is tariffs, how do you explain Ford's success? That tells me that the real problem isn't foreign competition - it's incompetent management at the other domestic companies. If that's true, & I think it is, then tariffs will only only make things worse by rewarding incompetence.

Should that be the path to success in business in this country? I don't think so.

cooterbfd · November 2010

":..... If, as some want us to believe, the problem is unfair foreign competition & the only solution is tariffs, how do you explain Ford's success?"

As good as Ford is doing, don't you think they would like to sell more cars in a country like Japan or S.Korea, where tariffs and other gov't red tape keep import sales down??

How is the USA supposed to combat issues of disparity in tariffs between what we charge and they charge?

jimbres · November 2010

As good as Ford is doing, don't you think they would like to sell more cars in a country like Japan or S.Korea, where tariffs and other gov't red tape keep import sales down??

The D3 have never shown any real interest in the Japanese market. If they were serious about selling to Japanese drivers, they'd have to spend money to build cars with the driver's controls on the right side, since the Japanese drive on the left side of the road. But the U.S. car makers made it clear more than 30 years ago that they didn't want to make this investment.

The Koreans could certainly do more to open their market, but that doesn't convince me that I should be forced to pay tariffs on Korean goods. Just because Korean consumers allow their government to mug them with higher prices doesn't require me to roll over & let my government pick my pocket in retaliation. The real victims of tariffs are the citizens of the country that's charging the tariffs. To save a few thousand jobs, millions are forced to pay higher prices. Sorry, but I don't feel like being a victim. I pay enough in taxes as it is.

Anyway, the Fed's policies are driving down the value of the dollar, which has the same effect on import prices as a tariff would. Thanks to the cheap dollar, virtually all imports - German cars, French wine, Canadian oil, etc. - will cost American buyers more.

keystonecarfan · November 2010

I'm sure that Ford would like to sell more cars in Japan and South Korea. I highly doubt, however, that it would ever consider doing so by shipping products made in North America to those countries. Most North American Fords are simply too big and cumbersome for most drivers in those countries. Not many people want to thread an F-150 through Tokyo traffic, even if it does feature right-hand drive.

The cars most likely to succeed in Japan or South Korea would be the Fiesta and the Mustang. The first is assembled in Mexico, and the second would be a niche vehicle at best. I doubt that either the Japanese or the South Koreans are chomping at the bit to drive a Cobalt or current-generation North American Ford Focus.

The simple fact is that GM and Ford have, since the 1930s, followed a strategy of either buying local companies (Holden, Vauxhall, Opel, etc.) or setting up subsidiaries (Ford of Europe) to meet the needs of foreign markets. Regardless of what type of trade agreement President Obama negotiates with other countries, neither company is likely to deviate from that strategy in the future.

cooterbfd · November 2010

".....If they were serious about selling to Japanese drivers, they'd have to spend money to build cars with the driver's controls on the right side, since the Japanese drive on the left side of the road."

Sure, but for decades, GM and Ford have built right hand drive cars. All they would have had to do is import them from Austrailia. Once they had a foothold, then there would be a market to justify a RHD Corvette, GTO, 442, or any of the other popular cars from the '50's or 60's

Buying American Cars What Does It Mean?

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