Automotive Industry Withers Away

Brantford, ON

“Cars are the dominant creatures, humans are just the servants,” said Tim Falconer, author of “A Road Trip through Our Complicated Affair with the Automobile.” Our world in the 21st century has been built around the vehicle. From conception in the “back seat” to being carried away by the Hurst, our lives are based around the vehicle.

Before the automobile, horse and carriage were primary means of transportation. According to Falconer, “When the vehicle was invented, people believed the car was the utopia.” Little did they know that the vehicle was going to create a major demise in world history.

Looking back, we can all remember the ultimate Henry Ford. Ford introduced his revolutionary Model T in 1908. To meet growing demand, Ford’s company opened a large factory at Highland Park, Michigan, in 1910. Here, Ford combined his own ideas with those of the famous Fredrick Winslow Taylor’s successful “Scientific Management.” “Scientific Management” combined precession, manufacturing, standardized and interchangeable parts, and division of labour. Workers remained in place, adding one component to each automobile as it moved down the line, and essentially moved down the road through history.

But with ups and downs in the economy including job cuts, technology breakthroughs, the oil crisis, and the major recession taking place in the United States, the question posed is, how much does our economy actually depend on the automobile?

According to economist Jim Stanford in the Research Department of the Canadian Auto Workers, Canada’s largest private-sector trade union, “The economy depends on the auto industry that makes about 120 000 jobs for people in Canada today, both directly and indirectly. From the donut shop to the dry cleaners, everything depends on the automotive tax dollar. Economists estimate that for every job in a major auto facility, there are about 7.5 jobs in total that depend on that job.”

On the other hand, Jeff Hermer, a group leader for the Toyota plant in Kitchener Ontario explains, “A lot of people have quit buying vehicles because of the ongoing highs and lows of gas prices. The small man now is getting put out.”

The United States auto industry, once the cornerstone of the U.S economy, has been brought to its knees, along with the high-paying and secure jobs it once supplied. According to Carlo Basilone from The Real News Network, “U.S auto sales plunged in June to a 15-year low as consumers shunned pick up trucks and large SUVs with the high price of gasoline. Ford plans to transform three American truck plants to build small cars originally developed for European markets.”

With the low demand of automobiles, comes striking evidence of job cuts. “We are seeing a lot of job loss with 400 000 jobs cut since 2002. This reflects globalization and that is why many communities are suffering,” stated Stanford.

According to Real News, General Motors in the United States eliminated half of its hourly workforce since 2004, from 106 911 to 55 000 this year, while in Canada more than 30 000 auto jobs have been lost since 2001.

A major factor to consider is technology growth and the expansion of machinery and robots. According to Richard Sennett in his book “The Culture of the New Capitalism,” as automation spreads, the field of fixed human skills shrinks. Today it’s taken for granted. Here again appears the idealized new self: an individual constantly learning new skills, changing his or her ‘knowledge basis.’ In reality that ideal is driven by the necessity of keeping ahead of the machine.”

On the contrary, Jim Stanford states, “Technology is not taking over. It has been carrying on for hundreds of years. You can create jobs as you grow forward.” For Jeff Hermer this is not what is taking place, “Technology will take over to a certain extent. Technology has replaced people with robots already in my plant, especially in the welding and paint shops.”

According to CTV news, the Federal government assistance for the auto industry would not include a short-term cash infusion, such as the proposed $25 billion bailout the U.S Congress is debating for American car manufacturers. Industry minister Tony Clement stated, “The Canadian government won’t be offering a short-term bailout to Canadian auto makers, but would help the industry transform itself so it makes cars that people actually want to buy.”

“Jobs haven’t disappeared they have just moved to other countries such as Japan, Korea, China, and Europe. It’s called outsourcing and eventually the entire North American auto industry will move to these countries where their government’s will play an active role,” states Stanford.

On the other hand, Jeff Hermer has another opinion. “The government shouldn’t provide a direct bail out but they should come up with a plan that will work with the auto industry. You can’t just give us $100 million and say see ya, we won’t learn anything from this.”

With extensive evidence of declining economies being shown in both the American and Canadian auto industries, there must be some sort of solution. According to Jim Stanford, “We need a North American auto pact. We need a policy for the whole continent that would require auto makers to produce as many vehicles in North America as they sell here; that would ensure that each of the three countries in North America gets a fair share of the jobs and investment in this industry, proportional to the size of their market and their population; and that gave support for the industry as it retools and reinvests in smaller cars and in more environmentally-effective vehicles.”