Tags: automakers | Ford | hire | investing

US Automakers’ Comeback Brings Jobs

By Michelle Smith   |   Tuesday, 26 Feb 2013 07:46 AM

Considering all the industries ravaged by the financial crisis, U.S. automakers are achieving one of the most unlikely comebacks, according to The New York Times. Auto sales are rising and the Big Three are investing and hiring.

“Tonight the auto industry is back,” President Barack Obama said during his State of the Union address. Some may have thought he was tooting his own horn to rile critics of the auto bailout, but it appears that U.S. automakers are truly on the road to recovery.

It was not so long ago that American car companies were the main characters in stories about factories that were closing and downsizing. These were not works of fiction and the story lines included tens of thousands of job being lost.

Editor's Note: I Wish I Were Wrong — Economist Laments Being Right. See Interview.

Now, those companies are recovering, and with that they are bringing back the jobs.

Ford — the only of the Big Three U.S. automakers not to accept bailout funds — recently announced plans to invest $200 million in a Cleveland plant where it will begin building its EcoBoost turbocharged engines, The Associated Press reported. The fuel-efficient engines are growing increasingly popular and Ford has promised 450 jobs to help meet demand.

And few expect the hiring to stop there, the AP added.

During the financial crisis General Motors and Chrysler were at risk of taking a place in the history books as their ability survive was seriously in question. Now, that concern appears to have faded and they too are investing and hiring.

In 2012, GM announced plans to create 7,000 new jobs and many of those are expected this year, according to USA Today. The company also plans to spend $600 million on its Kansas City assembly plant, The New York Times reported.

Chrysler has announced it will add a third shift at the Detroit Jeep plant and another shift at a facility in Toledo, Ohio. Each of these shift additions is good for over 1,000 jobs, according to USA Today.

Analysts expect U.S. auto sales to rise by about 800,000 units this year, the AP reported. That would mean sales of 15.3 million vehicles.

Those strong sales are expected to be complimented with increased hiring throughout the auto industry, including in showrooms across the nation.

But it was not just bailout funds and financial restructuring that helped U.S. automakers get back on track. Concessions by the United Automobile Workers are also credited for making the Big Three more competitive.

With new hires getting pay that will rise to about $19 per hour plus benefits under the four-year contract negotiated last year, GM's average compensation is now close to Toyota's in the United States, the Center for Automotive Research told USA Today.

Joseph Hinrich, head of Ford’s Americas region, told The Times that it was a new local agreement with the United Automobile Workers union in Cleveland that paved the way for the expansion there.

Editor's Note: I Wish I Were Wrong — Economist Laments Being Right. See Interview.

© 2015 Newsmax Finance. All rights reserved.

1Like our page

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

© Newsmax Media, Inc.
All Rights Reserved