U.S. Media: The Real Reason for the Loss of Auto Industry Jobs
Reference News website reported on April 16 that a CNN website article titled "Trump Says Free Trade Killed American Auto Jobs, But That's Not True" was published on April 14. The author is Chris Isidore. The following are excerpts from the article:
President Trump's tariff claims largely focus on restoring manufacturing jobs, especially auto industry jobs. He claims these jobs have been destroyed by bad trade agreements like the North American Free Trade Agreement (NAFTA).
President Trump promised that imposing a 25% tariff on all imported cars would significantly increase production costs and prompt a large number of new car factories to be built in the U.S., thereby bringing auto industry jobs back to America. However, the loss of auto industry jobs in the U.S., particularly in the Midwest and northern regions, has complex causes far beyond just trade agreements or moving production to low-cost countries. Another key reason is that for many years, questions about the quality and value of American-made cars have led consumers to abandon the Big Three Detroit automakers. Most importantly, the introduction of automation technology has greatly reduced the labor hours required to assemble cars.
Jason Miller, a professor at Michigan State University, stated: "The real problem with the loss of auto industry jobs lies in automation." Miller said that part of the strong dissatisfaction with the transfer of production to Mexico and the resulting closure of assembly plants and auto parts factories stems from the timing. The introduction of more robots and subsequent job losses "happened to coincide with the period of trade liberalization."
Moreover, the situation is not as bad as President Trump described. According to data from the U.S. Department of Labor, there are actually more workers employed in U.S. auto assembly plants today than when the North American Free Trade Agreement took effect in 1994.
Experts generally agree that among the many reasons for the closure of auto factories, the impact of trade agreements is far less than that of automation and lost market share. Clearly, tariff policies cannot reverse these deep structural factors.
Automation has completely transformed the automotive manufacturing industry. Laurie Harper, partner of automotive consulting firm Wap Valley, said that automation has dramatically reduced production time per vehicle from about 50 hours in 1988 to 18 to 20 hours in 2005.
Harper said: "At the same time, the market share of the Big Three Detroit automakers plummeted sharply. These two factors combined ultimately led to factory closures."
Data from another automotive information agency, WardsAuto, shows that until the early 1970s, over 80% of U.S. auto sales were still dominated by the traditional Big Three American automakers: General Motors, Ford, and Chrysler (now part of Stellantis). However, this began to change with the impact of imported Japanese cars. By 2007, the Big Three lost their majority share of the U.S. market for the first time; by 2024, their total market share in the U.S. fell to only 38%.
Patrick Anderson, president of the Anderson Economic Group think tank, said that much of the loss in market share is due to the companies themselves. He said: "Quality defects, lack of innovation in design, and deteriorating labor relations two or three decades ago had a long-term negative impact on American automakers." He also said that in recent years, the quality of American brand vehicles has improved somewhat, but they still haven't won back those consumers who switched to import brands.
Despite facing many challenges, American auto factories continue to dominate the North American market and are also important participants globally.
According to data from S&P Global Mobility, last year, the number of cars assembled in U.S. domestic factories accounted for two-thirds of the total output in North America.
According to WardsAuto data, since NAFTA took effect, U.S. auto production has fallen by only 14%. During this period, Mexico's auto production surged by 272%.
Although the Trump administration strongly advocated for promoting industrial repatriation through tariff policies, this measure will not achieve the short-term goal of relocating overseas auto factories back to the U.S.
Excess capacity American auto assembly plants may not immediately begin producing newly added models currently being produced elsewhere. Restarting closed factories could take several years. Even building new auto factories, they need to be highly automated to compete with factories in Mexico where labor costs are lower.
Miller said: "Due to automation, the number of manufacturing jobs in the U.S. cannot return to the levels seen in the 1990s." (Compiled by Wu Mei)
Original source: https://www.toutiao.com/article/7493913203986956834/
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