Big 3 rescue wins rivals' support | detnews.com | The Detroit News
Big 3 rescue wins rivals' support
Foreign-based carmakers fear backlash collapse of Detroit's auto industry would have on supply chain.
Christine Tierney / The Detroit News
WASHINGTON -- They may be unrelenting rivals of Detroit's Big Three, but foreign-based automakers don't relish the prospect that one or more of Detroit's automakers might go under.
On the contrary, the risk that one of the U.S. car companies could collapse deeply worries Asian and German manufacturers with U.S. factories.
As the industry's outlook has deteriorated in recent months, executives at foreign car companies have said they want to see Detroit's cash-strapped automakers get through the crisis, noting that they all share the same network of suppliers.
"We're joined at the hip with our Detroit brethren in manufacturing," said Irv Miller, group vice president and chief spokesman at Toyota Motor Corp.'s U.S. sales subsidiary. Whatever the U.S. government proposes to keep the U.S. automakers afloat, "we support it," Miller said.
On Friday the Bush administration signaled that it would extend a financial lifeline to General Motors Corp. and Chrysler LLC after a bailout bill died Thursday night in the Senate, where it ran into fierce opposition from Republicans. Some of the bill's most vocal critics, such as Sen. Richard Shelby of Alabama and Sen. Bob Corker of Tennessee, represent southern states that have successfully courted investment from foreign automakers.
In the past few weeks, as senators from states with foreign transplants have grown more strident in their criticism of Detroit's top managers and the United Auto Workers union, executives from Japanese and German companies have tried to distance themselves from those sentiments.
Honda executives made it clear last month that they didn't share the views expressed by Rep. Mike Pence, R-Ind., who said during the opening of Honda Motor Co.'s new assembly plant in Greensburg, Ind., that he would rather see the U.S. automakers file for bankruptcy than receive taxpayer money.
Jeffrey Smith, assistant vice president for corporate affairs at American Honda, told reporters, "Honda supports measures that would maintain the short- and long-term viability and stability of the auto industry."
Like his colleagues at Toyota, Smith noted that all automakers that have U.S. production facilities are "deeply and closely integrated at the supply base."
Some executives at foreign automakers are being tactful to prevent a resurgence of the kind of protectionism and backlash that flared in the 1970s and 1980s. But those sentiments have subsided, particularly in regions where German automakers BMW AG and Daimler AG's Mercedes-Benz and the Japanese and Koreans have built factories.
Executives at the Japanese manufacturers have been surprised to hear lawmakers assert that their workers earn far less than workers employed by Detroit's automakers. One executive who spoke on condition of anonymity confirmed UAW President Ron Gettelfinger's remarks Friday that team members, or line workers, at Toyota's largest North American assembly plant in Georgetown, Ky., earned more than the average UAW worker.
According to Gettelfinger, a UAW worker earns wages of just over $28 an hour, on average, compared with $30.45 an hour for Georgetown's non-union workers. That includes profit-sharing bonuses that are likely to decline for the current year.
Wages at Nissan Motor Co. and Honda sites average between $25 and $29 an hour and tend to rise faster than pay at UAW plants.
Including benefits and other compensation, the gap widens, with UAW workers costing $55 an hour on average, compared with an hourly cost of around $45 at the transplants. But concessions made in the last UAW contract in 2007, including lower starting wages for new hires, are expected to close that gap by 2012.
In recent months, foreign automakers and parts suppliers have tried to work out contingency plans in the event of a collapse of one of Detroit's Big Three. But executives say they would not be able to shield themselves from the impact of an automaker's collapse because the number of distressed suppliers in North America already is in the hundreds.
