The survey by Nanos Research for The Globe and Mail found 43 per cent of respondents say they support the move, while 20 per cent say they somewhat support the measure
The first two (labour and quality control) aren’t really what affect the MSRP. Labour makes a difference, but it’ materials cost that really drives price, and QA isn’t really the differentiator you might think.
But that last one–government support–that makes a massive difference. China has been, and continues to be, very strategic throughout the entire supply chain, from security raw materials at low cost, to building transport and energy infrastructure, to setting up hub-and-spoke centres for OEMs and suppliers, to securing a labour force. Non-Chinese OEMs, and especially Americans that depend on tax rebates little else, can’t compete.
It wouldn’t hurt the American and Canadian governments to twist the arm of industry and get them to think a little more long-term. They won’t, of course, because of neoliberal capture, but they could.
The first two (labour and quality control) aren’t really what affect the MSRP. Labour makes a difference, but it’ materials cost that really drives price, and QA isn’t really the differentiator you might think.
Uh, what, both of these have a massive affect on final price.
The fact that labour is so expensive in Canada, the US and Western Europe is a big reason we farm stuff out to cheaper places (like Mexico and China) that don’t have pesky things like high safety standards or employee benefits. I mean, shit, the fact the huge disparity in labour costs between the two countries is reason the TFW program even works. Not to mention that cost of labour is the main reason companies push for automation… it costs a lot less to have a couple guys maintianing robots than 20 guys on an assembly line.
You are correct in that QA itself is basically nothing on the MRSP but failures can cause the end user a lot of time and money to deal with… not a hassle I personally want and nobody else should either. QA is one of the biggest reasons I never buy any big ticket items made in China.
Plus there is the fact that buying literally anything Chinese is supporting an oppressive authoritarian regime.
Labour makes up about 15-20% of the cost of a vehicle. Curiously, that number doesn’t change all that much between jurisdictions.
And while ~18% is as lot, materials makes up most of the rest, and those costs don’t change with jurisdiction. So the OEMs relocate to save a few percent, but mostly they relocate because the overall supply chain is more cost effective. This is why China (and now Vietnam, and Thailand, and before China, Japan and South Korea) are able to do what they do: the government and industry are willing to think long-term and make huge investments to make it happen: slapping down power plants and steel mills and making trade deals with, eg, Africa or the middle east to secure resources at scale.
You’re falling for the modern version of blaming the working class–even in a roundabout way–for the capitalists’ failure to plan.
Companies seek out cheaper labour, sure, but you’re taking a very simplistic view of it:
Canada, the US and Western Europe is a big reason we farm stuff out to cheaper places (like Mexico and China) that don’t have pesky things like high safety standards or employee benefits.
This isn’t nearly the case any more, and hasn’t been since the 1970s. They actually do have roughly similar safety standards. Replacing workers is expensive, and churn costs a lot, and you really do want to run a plant as efficiently as possible, which means not burning people out. We’re not in the triangle shirtwaist era any more.
Workers don’t really have much of an impact on the cost or quality of the product because it’s cheaper to engineer your plant such that they don’t. Mistakes are expensive. Waste is expensive. Re-work is expensive.
If you had said environmental standards, yes, you’d be right. Those can be more lax. That’s something different, and also not nearly the gap it used to be.
the fact the huge disparity in labour costs between the two countries is reason the TFW program even works
Slinging donuts at Tim Hortons, answering support calls and/or writing shitty front-end web code is a different thing entirely, and yes the TFW program is a problem, but that’s not the issue with heavy industry.
The first two (labour and quality control) aren’t really what affect the MSRP. Labour makes a difference, but it’ materials cost that really drives price, and QA isn’t really the differentiator you might think.
But that last one–government support–that makes a massive difference. China has been, and continues to be, very strategic throughout the entire supply chain, from security raw materials at low cost, to building transport and energy infrastructure, to setting up hub-and-spoke centres for OEMs and suppliers, to securing a labour force. Non-Chinese OEMs, and especially Americans that depend on tax rebates little else, can’t compete.
It wouldn’t hurt the American and Canadian governments to twist the arm of industry and get them to think a little more long-term. They won’t, of course, because of neoliberal capture, but they could.
Uh, what, both of these have a massive affect on final price.
The fact that labour is so expensive in Canada, the US and Western Europe is a big reason we farm stuff out to cheaper places (like Mexico and China) that don’t have pesky things like high safety standards or employee benefits. I mean, shit, the fact the huge disparity in labour costs between the two countries is reason the TFW program even works. Not to mention that cost of labour is the main reason companies push for automation… it costs a lot less to have a couple guys maintianing robots than 20 guys on an assembly line.
You are correct in that QA itself is basically nothing on the MRSP but failures can cause the end user a lot of time and money to deal with… not a hassle I personally want and nobody else should either. QA is one of the biggest reasons I never buy any big ticket items made in China.
Plus there is the fact that buying literally anything Chinese is supporting an oppressive authoritarian regime.
Labour makes up about 15-20% of the cost of a vehicle. Curiously, that number doesn’t change all that much between jurisdictions.
And while ~18% is as lot, materials makes up most of the rest, and those costs don’t change with jurisdiction. So the OEMs relocate to save a few percent, but mostly they relocate because the overall supply chain is more cost effective. This is why China (and now Vietnam, and Thailand, and before China, Japan and South Korea) are able to do what they do: the government and industry are willing to think long-term and make huge investments to make it happen: slapping down power plants and steel mills and making trade deals with, eg, Africa or the middle east to secure resources at scale.
You’re falling for the modern version of blaming the working class–even in a roundabout way–for the capitalists’ failure to plan.
Companies seek out cheaper labour, sure, but you’re taking a very simplistic view of it:
This isn’t nearly the case any more, and hasn’t been since the 1970s. They actually do have roughly similar safety standards. Replacing workers is expensive, and churn costs a lot, and you really do want to run a plant as efficiently as possible, which means not burning people out. We’re not in the triangle shirtwaist era any more.
Workers don’t really have much of an impact on the cost or quality of the product because it’s cheaper to engineer your plant such that they don’t. Mistakes are expensive. Waste is expensive. Re-work is expensive.
If you had said environmental standards, yes, you’d be right. Those can be more lax. That’s something different, and also not nearly the gap it used to be.
Slinging donuts at Tim Hortons, answering support calls and/or writing shitty front-end web code is a different thing entirely, and yes the TFW program is a problem, but that’s not the issue with heavy industry.