Detroit 3 Closing Worker Pay Gap with Foreign Competitors

Sean McAlinden, an economist working for the Center for Automotive Research, says that due to shifts in UAW retiree / health planning US auto manufacturers may end up with a labor-cost advantage in the next few years. GM is used as the prime example.

Here's a look at the timeline:

In 2007, per-vehicle labor costs for GM were $1,400 more than Toyota, its largest international competitor. $950 of that was for retiree benefits.

In 2008, Detroit's Big 3 manufacturers (Ford, GM and Chrysler LLC) were reportedly paying their hourly employees $69,368 per year on average versus $70,185 being earned by employees at foreign-owned plants. Salaried employees at the Detroit automakers were making $122,963 versus $81,506 earned by foreign-based counterparts.

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