

Ford has most advanced auto plant... in Brazil - steveplace
http://info.detnews.com/video/index.cfm?id=1189

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mdasen
For a little economic theory:

Usually economists break goods into two categories: normal and inferior.
Inferior goods are things like public transit. As people have more money, they
want less of it (because they'd rather use their car than wait for the bus).
Normal goods are things that people want more of as their income increases. TV
channels is a good example; as you have more money, you get premium packages
and the like.

Cars are somewhat normal. People do want more of them as their income goes up
(or vehicle prices go down), but it isn't as elastic to income as many other
normal goods (as income rises (or costs fall) by x%, people only want to
increase their consumption by y% where y < x).

So, what does that mean for auto makers and the UAW? Well, for a long time a
certain amount of mechanization and automation was in labor's interest. If you
(as a laborer) are more productive per unit of time, your labor is more
valuable even if part of that productiveness is due to automation. However,
one could argue that cars are reaching a saturation point (more likely that
the second derivative of automobile growth is negative -- yay calc!).

So, if you reduce costs to build a vehicle through automation meaning you
require less labor per vehicle and vehicles become cheaper, that's fine for
labor as long as the demand for vehicles goes up proportional to the decrease
in labor required per vehicle. That doesn't seem likely.

So, automation threatens jobs in this case. If Ford produces vehicles cheaper,
people don't demand proportionally more vehicles. Also, capital goods cost
money and so at best labor can lay claim to n% of any increase in profits due
to automation where 0 < n < 100.

If the automotive industry were rapidly expanding at ever increasing rates,
labor would (should) be pro-automation since it means the value of their
output is increasing and the demand is there for more vehicles than they can
build. Right now, the UAW is trying to hold onto what was.

As automation becomes a force in our world, the labor required to produce 1
unit of anything decreases. Therefore, to ensure your own job security, you
must either a) find someone that will institutionalize your job like the UAW
got the bog three to agree to -or- b) work in an industry where demand for the
output is outpacing (or equaling) the reduction in labor required due to
automation.

For example, if demand for computers rises 10% per annum and each year 10%
less labor is required to create a single computer, the computer industry
requires a stable labor pool at M people. However, if demand for computers is
stable and each year 10% less labor is required to create a single computer,
you can see how that would be a problem for computer workers. I think the
equation would be P(t) = M * .9^t; where the output is the labor required at
year t.

