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Comment by adminscoffee | Hacker News Reader

then they will relocate sections of the factory gradually. before you downvote, i'm not agreeing with this process but just stating what will happen next. a system that is maintained will always * look for ways to "optimize", think of any first job you had, remember how boring certain task were? or downtime? what did you do? you found something to do, most of the time it's some type of optimization. upper management will not be able to look at what is classically label as "inefficient" without going in there and "nudging" this or that part. i've experienced this first hand working in factories as an assembly line worker

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They sure will. And like Boeing, their once-impeccable reputation for quality will continue to slide into the mud. No worry, that's years from now. The execs responsible for the outsourcing will get hefty bonuses for the immediate savings, and retire happy.

relocate - to where exactly?

There are two major manufacturing hubs in the world - east Asia and central Europe. Labor costs in manufacturing around the world have equalized to start at around $12/h. Slightly more in automotive. Average wage (whole economy) in Guangdong is ~$10/h. Labor cost in Poland is ~$13/h. The days of labor cost arbitrage are over

One can find cheaper labor, but it's always at the cost of worse infrastructure, missing supply chains or increased shipping costs. This is not pharma or silicon, where value per kilogram makes the cost of shipping is negligible. Manufacturing and assembly of heavy items like cars, trains or construction materials is nearly always near-shored

I might be wrong about this but it seems like foreign cars are an exception to this trend, specifically Japanese cars sold in the United States. Do you know what factors might be at play here?

Those are foreign designed but not necessarily foreign made. If you buy Honda Accord in the US, it is likely to com from a factory in Ohio. If you buy Toyota Corolla in EU, it is likely to come from factory in Turkey (or UK, but probably not anymore due to Brexit).

> then they will relocate sections of the factory gradually.

Then we will tariff farm equipment manufactured wherever they relocate to. Deere will find it hard to get politicians to be on their side on that sort of thing, if they don't have a domestic presence.

There's a reason why GM, Ford, etc, make cars in the United States - and it's not because they like dealing with UAW.

Shipping costs (cars are big) and exchange rates (buying components/labour in the same currency that you sell in reduces some pricing risk) are major considerations.

>Then we will tariff ...

>There's a reason why GM, Ford, etc, make cars in the United States ...

Is that even true after NAFTA/USMCA?

Many "American" cars have been made in Canada since the beginning. In the beginning US automakers set up factories in Canada for export to Britain to take advantage of Canada being duty free as part of the empire. Then in 1965 the Auto Pact was signed which unified the US/Canada car market in exchange for American car factories in Canada. Since then Canada has produced ~10% of "American" cars, but has imported a similar number of American cars.

NAFTA/USMCA allows some manufacturing in Mexico/Canada (Which has largely equivalent labor costs), but if these manufacturers pulled out of the US, it would be repealed before you could blink.

So unions, and the labour movement generally, need to work on a national or international scale. In particular secondary action must be legal and a credible threat for companies that try to exploit their workers.

Ain't that's what govt. are for? Elect representative who favour higher min. wage

The state is always in service of the ruling class. This much is beyond evident in the U.S. as the semblance of democracy that took shape over the expansion of the American empire erodes.

And regardless, you would have to have a democracy, which is to say at minimum circumstances in which “a representative who favours a higher min. wage” could democratically run in the first place. The U.S. has nothing even close.

> then they will relocate sections of the factory gradually

In the late 1930s, Larry Page's grandfather participated in a sit down strike that helped consolidate the UAW. The grandfather auto worker made a decent union wage living and sent his son to college. The son became a professor, and his son founded Google and became a billionaire.

Meanwhile the textile mills in the Carolinas were mostly unorganized, and the post-WWII drive to organize them was defeated. And - the Carolinas still have a thriving textile industry today. No. The mills have almost all shut down and moved elsewhere. The industrial buildings serve as hipster like places for restaurants, apartments, boutiques etc. The southern textile workers never got their payday, they worked in the mills and the mills shut down.

Are you saying if the Carolina's textile mills organized in the 1930's the US would still have a thriving textile's industry?

I can assure you that wouldn't have been the case at all.

And keep in mind the US auto industry is not the world leader and hasn't been for 50+ years. UAW membership numbers have gone from >1.5M in 1980 to less than 300k today.

Yeah I worked as an engineer at a plant (different company) with ~400 union jobs. A year after a successful union contract negotiation, my plant was shuttered and the output sourced China. 7 years later, my friends that still work at the downstream plant say the quality is not near as good and they spend far more on re-work than they saved by shuttering the plant.

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