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USA and Mexico built trucks same price, why


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Why is it that you go to a GM dealership and trucks built in Mexico are the same price as trucks built in the USA?

GM pays far less labor fees for trucks they build in Mexico so why don't customers see a difference in the price of a truck built in Mexico vs built in the USA?

 

The value of the dollar and inflation. I'm not into politics but i'm a firm believer in supporting American jobs...but after reading an article on how the value of the dollar is effecting jobs and where they are going more then NAFTA I kind of get it. Yes it sucks some jobs have gone across the border, but this is happening in every country. With currency going up in value and trying to balance affordability and profit, moving jobs for cheaper labor is one way to cope. On a side note, I ran across another article on a list of things that are common in the US as far as consumer goods..and what they would really cost if they were 100% made here..a pair of levi jeans was estimated at like 250 bucks, IPhone was well over 2 grand. Yes trucks are not cheap, but I think the harsh reality is that companys are trying to keep them half ass affordable, otherwise they will lose profit with nobody buying product.

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Was doing some digging on hourly labor costs regarding auto workers. Take all the hours cumulatively that they work in a year, and multiply that by $9 and that is what the auto companies are on the tab for regarding U.S. workers who are no longer working. That $9 per hour is more than some in America are making and substantially more than many folks outside the U.S. are making. And that $9 per hour cost is still there even if the vehicle is made outside the U.S. So when you add that $9 per hour to the books and add in Pedro's salary, the labor cost is not as cheap as some might think even when the vehicle is made south of the U.S. border.

 

While labor is not cheap here for sure, I am still convinced that it is tolerable. It is the regulatory requirements that get piled on the by the beloved politicians at the Fed, State, and local level, micromanaging just about every activity and process in the work place. Throw in the quagmire of environmental regulations and such and the mess becomes almost insurmountable. This is one reason why there has not been a new oil refinery built in the U.S. for over 3 decades as an example. Sure, they are better able to navigate this mess by expanding existing refineries, but that has it's limits. There is a major refinery slated for start up construction this year in south Texas, but it could be halted or put on hold at any time by any one of a dozen government agencies at any time if just one thing doesn't fit their guidelines. Trump did put a hold on new government regulations, but that is like standing there and saying "halt" after the dam has already burst and you are facing a tall wall of water about to take you out.

 

And Doug stated the case on the dollar aspect pretty good.

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Seems like I read in Mexico USA mfg.'s pay on average $4.50 per hr. India is the country where average wage is like .65 cents per hr. Surprised more of them don't flock to India. Think about it you can have about 40 workers for the cost of 1 here.

It's too bad that figure wasn't more available. Over the years I've tried to find the same info to no avail. How does a worker in the US (or Canada) compete w/ that?

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Was doing some digging on hourly labor costs regarding auto workers. Take all the hours cumulatively that they work in a year, and multiply that by $9 and that is what the auto companies are on the tab for regarding U.S. workers who are no longer working. That $9 per hour is more than some in America are making and substantially more than many folks outside the U.S. are making. And that $9 per hour cost is still there even if the vehicle is made outside the U.S. So when you add that $9 per hour to the books and add in Pedro's salary, the labor cost is not as cheap as some might think even when the vehicle is made south of the U.S. border.

 

While labor is not cheap here for sure, I am still convinced that it is tolerable. It is the regulatory requirements that get piled on the by the beloved politicians at the Fed, State, and local level, micromanaging just about every activity and process in the work place. Throw in the quagmire of environmental regulations and such and the mess becomes almost insurmountable. This is one reason why there has not been a new oil refinery built in the U.S. for over 3 decades as an example. Sure, they are better able to navigate this mess by expanding existing refineries, but that has it's limits. There is a major refinery slated for start up construction this year in south Texas, but it could be halted or put on hold at any time by any one of a dozen government agencies at any time if just one thing doesn't fit their guidelines. Trump did put a hold on new government regulations, but that is like standing there and saying "halt" after the dam has already burst and you are facing a tall wall of water about to take you out.

 

And Doug stated the case on the dollar aspect pretty good.

When our North Plant was still in operation, the plastics dep't moulded the bumper covers for the Lumina & Regal which were assembled in the Car Plant about a 15 minute haul away. New environmental regs made the paint shop obsolete. So rather than upgrade, the bare bumper covers were trucked to TN, painted & then trucked back to Oshawa.

 

Same thing probably happens to stuff in the US, shipped to Mexico where the H&S regs are pretty lax.

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I do not think very many American consumers really research each product and purchase it because it is a domestically produced. Cost and Quality are the deciding factors. If the cost is close and the perceived quality is about the same some MAY choose a domestic product but very few LOL.

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Ever notice the destination(shipping) charge on the sticker. Told by sales, at every dealership for a specific vehicle are all the same regardless of distance from the plant.

 

"That way it's fair for the person in California to buy a truck built in Michigan to pay the same price as the person in Michigan"

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Ever notice the destination(shipping) charge on the sticker. Told by sales, at every dealership for a specific vehicle are all the same regardless of distance from the plant.

 

"That way it's fair for the person in California to buy a truck built in Michigan to pay the same price as the person in Michigan"

Yes. Especially if your dealer is a 15 minute haul from the assembly plant.

 

GM used to allow out of province purchasers to pick up their vehicles in Oshawa & save the shipping. Not sure if they still allow it. That might be a deal for folks @ the western part of Quebec.

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Seems like I read in Mexico USA mfg.'s pay on average $4.50 per hr. India is the country where average wage is like .65 cents per hr. Surprised more of them don't flock to India. Think about it you can have about 40 workers for the cost of 1 here.

 

Logistics, pretty pricey to ship a vehicle to north America from asia​

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Logistics, pretty pricey to ship a vehicle to north America from asia​

 

 

 

That and trade. We have a trade agreement with Mexico. I haven't checked but I doubt one exists with India.

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Seems like I read in Mexico USA mfg.'s pay on average $4.50 per hr. India is the country where average wage is like .65 cents per hr. Surprised more of them don't flock to India. Think about it you can have about 40 workers for the cost of 1 here.

It won't be long unfortunately...

 

http://economictimes.indiatimes.com/industry/auto/general-motors-ford-and-fiat-reviewing-india-investment-plans/articleshow/53370482.cms

 

Even Harley-Davidson has investments in India.

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