AUTO-LANE

For a long time, I have been wondering if the low value of the yen and the subsequent low costs of manufacturing helped Japanese car manufacturers put in more quality and features into their costs. In a simplistic manner, because of the value of the currency and the cost of labour, you can have more people working on a product and at the same time, purchase raw material at lower costs in a country with lower federal taxes. Comparing 0.5% rates in Japan to 5.25% in the USA, it is easy to see that the Japanese can get more work done for the same cost of manufacturing. Along the same lines, the Koreans can get more work done compared to the Japanese. While this gives us an idea of why Japanese products look more attractive than the American counterparts, this thought also takes us to thinking along the lines of "what should American car manufacturers do to sell large volumes to offset the high manufacturing costs?" From a neutral standpoint, Americans should make cars that vibrate with the average man. The manufacturing comparison is well portrayed in the following link.

Labels: http://www.autoblog.com/2007/02/26/yen-vs-dollar-euro-both-us-and-european-automakers-feeling-the/