It is impossible to get writer's block when tasked with writing about American manufacturing. I can always count on the news for entertainment on a grand scale. Consider the following gems from this week's manufacturing news:
The Wall Street Journal reports that Ford is up to some insanity that is over the top even for a car company. It seems as though there has been a vans versus chicken war going on between the US and Europe for decades. The Europeans want to keep our chicken out, so we slapped a 25% import tariff on imported cargo vans. Toyota, Honda and Nissan got the message, so they make their cargo vans here. Not Ford. they make passenger vans in Turkey, bring them into the US in Baltimore and pay the lower passenger van tariff of 2.5%, then take them to a local warehouse to rip the seats out and toss them in the trash, thereby converting them to cargo vans and cleverly avoiding the tax meant to protect American manufacturers … like Ford. The government is going to have to get up pretty early in the morning if they are going to protect Toyota from those cheap foreign imports … like Ford.
Speaking of the government, the Fisker Automotive Group (which counts Al Gore among its bigger investors) is soon to be selling a Hollywood status symbol – a hybrid car called the Karma. The boys at Fisker were awarded a half billion dollar plus loan from the US government's Advanced Technologies Vehicle Manufacturing Loan Program. The money is going to be used to manufacturer the Karma, not in California where Fisker is headquartered and where over 4,000 auto manufacturing jobs are being flushed due to the demise of NUMMI, but in that hotbed of low cost manufacturing excellence – Finland. Yep – your tax dollars – the "Manufacturing Loan Program" – to manufacture cars in Finland.
The Wall Street Journal has bestowed one of its prestigious "Best Small Workplace" awards on the Radio Flyer company in Chicago. Radio Flyer is a great small workplace, rather than a big workplace, because they closed their factory and moved all of the wagon making to China. I bet the people who were laid off would scratch their heads at the Journal when it comes to just how great a place Radio Flyer is to work. The important thing, however, is that Radio Flyer is "still a Chicago brand," said CEO Robert Pasin at the time the jobs all went to China. The brand makes the work place, I guess, not the paycheck.
Finally, Tim Geithner says things are shaping up in the American economy. He is "seeing the first signs of optimism about prospects for global recovery". Further, he thinks "the broad consensus of private economists and businesses are that we're beginning to see growth in the United States, and around the world we see exports rising and forecasts for growth are being revised upwards."
The day before Geithner stamped his seal of approval on the direction things are going, the Labor Department announced that "The number of mass layoffs by U.S. employers rose by 533 in August from July, with the manufacturing sector the hardest hit." Further, they reported that, "The U.S. unemployment rate hit a 26-year high of 9.7 percent in August, and many economists expect it to peak above 10 percent early next year." I suppose Geithner meant growth in something other than jobs and manufacturing activity when he said he liked the way things are shaping up.
With news like this, no comment is necessary – it speaks volumes for itself.