Ford will buy between $2.5 billion and $3 billion in auto parts in China, said Bill Ford, chairman of the Dearborn-based carmaker. That compares with $1.6 billion to $1.7 billion last year. The parts will be exported to assembly plants in other Asian countries, the United States and Europe.This means that tranmissions, engine blocks, running gear of all sorts and even interior assemblies will be manufactured under slave-wage conditions in China. Of course, this doesn't necessarily mean that prices of Ford products to the customer will decline. Oh, no. It means that Ford's executives and major shareholders will get a bigger slice of the profit pie while American workers are frozen out.
Ford needs cheaper parts from China, where an average manufacturing job pays about 10% of an equivalent union job in the United States, to meet its goal of cutting $6 billion in annual costs by 2010. The carmaker reported a $5.8-billion third-quarter loss as sales slumped in the United States.I'd really like to know who is going to buy these cheaper-to-produce Ford cars and trucks when middle American is finding it harder and harder to make ends meet, despite everything Dim-Son and the Dow Jones average says.
Eventually the Chinese government, yes it's still technically Communist, will pull the plug. Why settle for profits based on purchases from one so-called industrial customer for parts when you can realize greater profits from eliminating the middle-man. The Chinese computer manufacturer Lenovo figured this fact out when it purchased IBM's PC divsion lock, stock and barrel in 2004. Pretty soon the Chinese auto parts industry will realize it doesn't need Ford, or the Ford family and major shareholders will think it wiser to sell the company to a wholly-owned Chinese venture and watch the dividends roll in. Either way it Joe Sixpack won't get anything for his money or the sweat of his brow.
The future for the United States of America looks pretty bleak from where I sit. Within ten years time, if the nation stays the course in all areas of human endeavor from its misguided foreign policy to the pro-population growth zeitgeist, America will be a Third-World hellhole.