Internationaly Owned Auto Makers Continue Investment on American Soil

Washington DC August 15, 2007; The AIADA newsletter reported that as Detroit's struggling automakers slash jobs, major European automakers are moving to expand U.S. operations, illustrating how the auto industry's globalization isn't just a one-way street for the U.S. economy.

German automakers are accelerating plans to ramp up U.S. production and add jobs as a hedge against the dollar's persistent weakness against the Euro, which has battered profits on vehicles exported from Europe.

BMW will boost production at its Spartanburg, S.C. plant and Volkswagen is considering the option of building in America again.

These are just two examples of a broad trend created over the past decade or more. Since 1990, General Motors Corp., Ford Motor Co. and Chrysler LLC have closed 29 North American assembly plants.

In the same period, Asian and European car makers have opened 24 North American assembly plants. Total U.S. vehicle production has grown to 16 million a year in 2006 from 12.5 million in 1990, according to Harbour Consulting of Troy, Mich.

The Wall Street Journal reported that it is the U.S. dollar's weakness causing the shift to build in America.

On the other hand, currency shifts are also affecting Asian automakers, though in different ways. In South Korea, Hyundai Motor Co. and Kia Motors Corp., hit by a strong won, have accelerated their overseas expansion plans, but last year Kia broke ground on its first U.S. factory. The plant, in Georgia, is about 100 miles from Hyundai's first U.S. factory in Alabama.