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View Diary: Bain Capital’s Sensata Threatens to Close Plant if We Keep it Up (94 comments)

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  •  Sensata makes auto engine sensors? (0+ / 0-)

    So if auto engine sensors cost less, won't that mean that the cars that UAW workers make will cost slightly less; making them more competitive against imported cars?

    •  congratulations (13+ / 0-)

      You've just joined the race to the fucking BOTTOM.

      The plant is profitable.  I presume there won't be any real effort to reduce the prices of the sensors, since the actual goal is to steal the employees' wages by replacing them with cheaper employees.  Lowering the auto engine sensors' cost would cut into the extra lucre they're getting by screwing their employees.

      •  Customs = Slightly brighter TSA employees (2+ / 0-)
        Recommended by:
        llywrch, NoMoreLies

        Assuming US Customs is still enforcing Country Of Origin marking requirements; the sensors are now going to be in boxes that say "made in China".

        And they are going to have a month added to their lead time.

        Once an auto maker notices the "made in China" markings instead of a "made in Indiana" marking; they are going to ask Sensata for a lower price.  Or they will start buying from a competitor.

        Or maybe the auto industry doesn't work the way I think it does.

        •  Sensata will be lowering the price anyway. (5+ / 0-)

          Just enough to undercut their competition and secure bigger contracts.  With the chinese labor costs, they'll still make more money in theory.  American competitors will then have to keep pace with the lower price forcing them to lower costs.  They can try to improve efficiencies and cut any waste, but people are the most expensive part of the equation. They will either cut jobs, salaries, or benefits in the short-term, but ultimately, they'll have to move jobs off-shore to stay competitive.

          This is the race to the bottom.  This is what the CEO's and business consultants, and writers mean when they talk about global competitiveness and throw accusations of protectionism.  If you prevent them from taking full advantage of cheap labor, they will always be underbid by those who do.  This can and often does lower their profitability and even put them out of business.

          This is also Romney's expertise.  This is why his business experience is largely irrelevant to creating jobs for Americans.  He is a pioneer in doing this.  Bain, his company, his ideas, his way, was instrumental in helping companies do this.  He has no solutions that will bring manufacturing back in America.  He really has no idea what to do about middle class jobs.  He does know what to do make those jobs cost less to the companies who need them—find cheaper labor.

          Bain is just following Romney's playbook.  

          "Wall Street expertise, an industry in which anything not explicitly illegal is fair game, and the illegal things are fair game too if you think you won't get caught." — Hunter

          by Back In Blue on Wed Oct 24, 2012 at 12:50:40 PM PDT

          [ Parent ]

    •  Not really (3+ / 0-)
      Recommended by:
      Utahrd, elwior, NoMoreLies

      First, it's a global market.

      Second, it's not a commodity product.  Most of the cost of this stuff is the R&D cost.  In general, labor costs are not significant in electronics assembly, except at the very lowest level of components, because initial setup, R&D, and other fixed costs dominate.  (China does now have another important advantage: so much of the global electronics industry is there that it's easier to set up a plant there than here, because there are not enough suppliers.)

      If you're curious what they cost, go look at your repair bill the next time the "check engine" light comes on in your car.

      And if you're curious how money will be made, it is flipping the business and using the cheap offshore labor to justify bullshit financial statements -- Bain owned businesses have a poor record for long term viability and I'll bet it goes bust under their ownership, whether here or in China.

    •  Not an expensive part. (1+ / 0-)
      Recommended by:

      "We the People of the United States...." -U.S. Constitution

      by elwior on Wed Oct 24, 2012 at 12:25:05 PM PDT

      [ Parent ]

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