After years of disparity, the Detroit Three automakers are nearly paying the same for their hourly workforce as Japanese rivals Toyota and Honda, a new report finds.
Although painful, concessions won by GM and Chrysler through their 2009 bankruptcies – which ultimately spread to Ford – are now paying dividends for the automakers in the form of lower hourly costs, according to Sean McAlinden, chief economist at Center for Automotive Research.
In fact, McAlinden predicts by 2015 that Chrysler's average hourly labor costs will actually be lower than Toyota's – $55 versus $58. Ford and GM won't be far behind with hourly costs of $62 and $60 respectively.
“There’s been a lot of changes to say the least,” McAlinden told the Detroit Free Press.
As a result of those falling costs, GM now has higher average transaction prices than Toyota in five vehicles segments.
However, the Detroit Three will still trail some foreign rivals by 2015. McAlinden projects Honda's costs at $53, Nissan's at $50, Hyundai's at $47 and Volkswagen at $40.
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