Forging Operations

[Geoff C.]

New GM part price books August 1st

[Geoff C.]

New GM part price books August 1st

[Joe L.]

Re: Good News ? Bad News ?

Geoffrey------

Yes, DELPHI (and, GM, too) have many manufacturing operations in Mexico. In fact, as I've mentioned previously, the new Chrysler Hemi, probably the hottest engine out there right now, is manufactured in Mexico and Chrysler is trying to figure out how to get more production out of a plant originally designed to manufacture about 250,000 Hemis per year. However, I've read some interesting information in Automotive News recently. It seems that the auto makers and their suppliers are starting to get a bit "disenchanted" with Mexico. They now feel that costs are too high in Mexico compared to CHINA. So, they want to start moving things to CHINA. As low as wages are in Mexico, they're LOTS lower in CHINA.

Chairman Mao, where are you when we need you!

[Joe L.]

Re: Good News ? Bad News ?

Geoffrey------

Yes, DELPHI (and, GM, too) have many manufacturing operations in Mexico. In fact, as I've mentioned previously, the new Chrysler Hemi, probably the hottest engine out there right now, is manufactured in Mexico and Chrysler is trying to figure out how to get more production out of a plant originally designed to manufacture about 250,000 Hemis per year. However, I've read some interesting information in Automotive News recently. It seems that the auto makers and their suppliers are starting to get a bit "disenchanted" with Mexico. They now feel that costs are too high in Mexico compared to CHINA. So, they want to start moving things to CHINA. As low as wages are in Mexico, they're LOTS lower in CHINA.

Chairman Mao, where are you when we need you!

[Dennis C.]

I really try hard to buy American...

Too bad that's almost impossible anymore.

[Dennis C.]

I really try hard to buy American...

Too bad that's almost impossible anymore.

[Geoff C.]

Re: I really try hard to buy American...

Soon it will probably be better to own stock in some foreign companies, since they produce here and the domestic companies don't.
F----- Up.

[Geoff C.]

Re: I really try hard to buy American...

Soon it will probably be better to own stock in some foreign companies, since they produce here and the domestic companies don't.
F----- Up.

[Chuck S.]

Re: Good News ? Bad News ?

Oh, yeah...The days of the booming maquilidoras are over, and companies are headed to the far east. Mexico squandered the opportunity to build infrastructure and educational resources when they had the cash flow. Now, look for the rush northward to continue and increase...Mexican paisanos aren't fussy about working at Burger King if it puts beans and tortillas on the table. The only trouble is...if illegal immigrants are flipping the burgers, what are our kids going to be doing?

It makes you wonder how GM could have 3-4 price increases a year...what the heck is inflating the prices? Beans? Rice? I don't think so.

[Chuck S.]

Re: Good News ? Bad News ?

Oh, yeah...The days of the booming maquilidoras are over, and companies are headed to the far east. Mexico squandered the opportunity to build infrastructure and educational resources when they had the cash flow. Now, look for the rush northward to continue and increase...Mexican paisanos aren't fussy about working at Burger King if it puts beans and tortillas on the table. The only trouble is...if illegal immigrants are flipping the burgers, what are our kids going to be doing?

It makes you wonder how GM could have 3-4 price increases a year...what the heck is inflating the prices? Beans? Rice? I don't think so.

[Geoff C.]

They gotta recover $5000 rebates somewhow

hey

[Geoff C.]

They gotta recover $5000 rebates somewhow

hey

[Patrick H.]

Re: Good News ? Bad News ?

It may not end in China.

Part of the reason for "source hopping" is executive bonuses and year end reports. Why?

Let's say you're AutoCompanyX. You promise your board a 13% improvement in profits in the next X years. And, to make it, you move to Mexico to cut costs through cheap labor (which more than offsets the cost of the plant and shipping). Now you promise them a 13% improvement over the next X years. So you move to China (it's labor is cheaper, and again more than makes up for the plant and shipping). Next, you'll promise the Board and stockholders another 13%, and you have to move to the next hot source of labor.

So why not move to China right away? Because then you'd have a 23% improvement in one cycle, and actually have to WORK to show profitability the next time around.

While a vast oversimplification, it's part of the reason for "source hopping." As China modernizes and its costs go up, watch for another country to take the lead.

Sometimes hidden sources in Tier 1 automotive suppliers can get you interesting information.

Patrick

[Patrick H.]

Re: Good News ? Bad News ?

It may not end in China.

Part of the reason for "source hopping" is executive bonuses and year end reports. Why?

Let's say you're AutoCompanyX. You promise your board a 13% improvement in profits in the next X years. And, to make it, you move to Mexico to cut costs through cheap labor (which more than offsets the cost of the plant and shipping). Now you promise them a 13% improvement over the next X years. So you move to China (it's labor is cheaper, and again more than makes up for the plant and shipping). Next, you'll promise the Board and stockholders another 13%, and you have to move to the next hot source of labor.

So why not move to China right away? Because then you'd have a 23% improvement in one cycle, and actually have to WORK to show profitability the next time around.

While a vast oversimplification, it's part of the reason for "source hopping." As China modernizes and its costs go up, watch for another country to take the lead.

Sometimes hidden sources in Tier 1 automotive suppliers can get you interesting information.

Patrick

[Bill W.]

Re: Good News ? Bad News ?

Don't foget the good old EPA. . Mexico don't care what goes in the air & water.
And its not just the union jobs we are loosing. My wife worked for Monsanto for 29 years ,got sold to IBM. worked there for 6 years. Her whole dept 300 + people got outsourced to Canada & India. She now works midnights on mainframes for half the money she was making before. The results are instead of buying a new ctx this year she is still driving her 98 blazer with 110,000 miles on it. Now thats good for the economy.
Oh yea try and buy an American made bicycle. The only ones I found were $2000 dollar + Treks made in Wisconsin. Bill