by Tyler Cowen
on October 19, 2013 at 6:38 pm
in Economics |
Today, nearly 40 percent of auto jobs on the continent are in Mexico.
There is more here, from Brad Plumer, interesting throughout.
Not surprising, manufacturing flows from high income areas to low income areas due to lower labor costs. In 10-15 years auto manufacturing will begin its movement from Mexico to Paraguay and other lower income countries.
It’s spelled “jerbs”.
“Back in the 1980s…”
“Half a century later…”
That’s fine, but when is Mexico going to develop automobile manufacturers of its own? You’re a China skeptic, yet they’re much closer to being major exporter of indigenous automobiles than Mexico is. We’ll see Chinese cars on America’s roads before we see Mexican ones.
Who are the indigenous Chinese manufacturers?
There are a number of them, producing over 40% of the cars in China according to Wikipedia.
I don’t think comparing the Mexican auto industry to China is particularly revealing, though. Mexico has 10% of China’s population and has been served by foreign automakers since the early days of cars. NAFTA means that there are no barriers to Mexico buying North American vehicles, while China levies huge tariffs on imported vehicles. So there are much higher incentives for China to develop a domestic auto industry.
Great Wall. They sell into Australia and Europe (I had to grub around Eastern European websites to find manuals). Most of what they sell is Toyota knock-offs. I had a 4Runner clone. They had a copy of the Scion XA and XB in the showroom at the same time. I could see those vehicles here in the us by 2020.
Hardly matters whether a firm assembles / manufactures to an external plan or reverse engineers under it’s own label.
I doubt the Chinese firms are doing any real, indigenous design.
Korea used to make knock-offs, now Kia and Hyundai are excellent cars at a fantastic price. Give it time.
Prof Cowen, the WaPo writer made a terrible mistake when quoting the 40% percent contribution of Mexico of auto production in the continent……..or is he predicting the collapse of auto industry in Brazil?
Might want to check with a Mexican before you place their country in South America… it’s a point of national pride.
Remember when Ross Perot talked about the giant sucking sound of jobs going to Mexico? Good times.
But we got cheaper cars for that bit of NAFTA, so it’s ok.
They’re not actually cheaper. Loan and lease terms just keep getting longer. But the average income of a new-car buyer keeps getting higher and higher. Also, used cars have grown more expensive in the Southwest as more are exported to Mexico.
Yeah but the quality has improved dramatically. My father had an ’81 Chevet. You wouldn’t be able to pay somebody to take that car off your lot today.
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