The market share of the “Big Three” U.S. declined 70 in 1998 to 53 in 2008. The company lost market share for imports and “transplants” (cars manufactured in factories owned by U.S. foreign producers).
Must face constant financial losses, the Big Three have closed many factories and drastically reduced employment, especially in Michigan. General Motors transferred many of its employees in certain divisions to separate companies, including American Axle in 1994 and Delphi in 1999. In 2000, Ford secretes a division in the company Visteon. Subsidiary companies and other auto manufacturers have shared the decline of Detroit as well as plants in Canada owned by U.S. companies. Overall, the fabricanets auto employ 416,000 people in United States and Canada. It is estimated that General Motors alone has lost 51 billion in the three years preceding the financial crisis of 2008 .
The Big Three are distinguished not only by its size and geography, but also for his business model. Most of its operations are unionized (United Auto Workers and Canadian Auto Workers), resulting in higher labor costs than other multinational car manufacturers, including those with plants in North America, who have managed to keep unions at bay . The Harbor Report 2005 estimated that Toyota’s leadership in labor productivity amounted to a cost advantage of 350 to 500 dollars per vehicle on American manufacturers. The auto workers’ union agreed on a salary of two ranks in negotiations conducted in 2007, something that the Canadian union had refused until now. Delphi, which was created by General Motors in 1999, I request bankruptcy after the union refused to cut their wages and it is expected that GM is responsible for a loss of 7 billion.
To improve profits, car manufacturers in Detroit were treated with unions to reduce wages, while commitments to issues of pensions and social security. For example, GM took the total cost of funding health insurance premiums for their employees, retirees and relatives, as the United States do not have a universal health system. With most of these plans for lack of funds end of the 1990s, companies have attempted to provide retirement packages to older employees and have made agreements with the union to transfer the pension obligations to an independent fund. However, the Japanese automobile manufacturers unionized work forces with their younger Americans (and many fewer American retirees) to continue taking advantage of a cost advantage.
A Chevrolet TrailBlazer, one of the USVs of General Motors.
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