German Jeep or American Land Rover

[MAC]

If anyone is interested, in the current issue of TIME, there is a special report on "Why the most profitable cars made in the USA are Japanese and German."

So here's the mystery: if foreign-based companies like Nissan — along with BMW, Honda and Toyota — are building more vehicles in American factories, using American workers and American suppliers, and selling the vehicles to Americans for a good profit, why aren't DaimlerChrysler, Ford and General Motors doing the same? Last year the Big Three collectively lost money on car sales in North America (and earned a mere 1.8% profit on overall sales). Honda and Nissan earned higher margins and record profits, and Toyota is expected to post similar results.

The stock explanation for this situation is that the foreign makers pay their U.S. workers less in wages and benefits than do the Big Three. But that answer is wrong; the compensation is roughly equivalent. The real reasons for the transplants' success are much more interesting and instructive: more efficient manufacturing systems, better labor relations, more collaborative relationships with suppliers, lower "legacy" costs for retirees' pensions and health benefits, and hard-earned reputations for quality.

http://www.time.com/time/globalbusin...451002,00.html