> US automobile manufacturers were once heavily vertically integrated but unions rendered such strategy non-viable decades ago.
Dean, although it's simple and attractive to blame labor unions on the demise of integrated suppliers, that's hardly the only reason GM and Delphi dumped their component divisions. After all, the spun-off companies still retained their high labor costs. Visteon (spun off by Ford) and Delphi (spun off by GM) both quickly went bankrupt, it's true, but that probably wasn't the intention of their parent companies. The stated reason for the spin-offs was for the OEMs to focus on their 'core business' (which of course was whatever the management at that time said it was).
The real problem with the in-house component suppliers is they had no incentive to be competitive. They knew they would always get a certain amount of business from their parent companies, no matter how expensive and shoddy their products were. Kicking the supplier divisions out the door forced them to sink or swim in the cutthroat pool of Tier 1 automotive suppliers. And of course their parent companies got a nice chunk of change when they spun off the component suppliers.
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Today's Featured Article - Grain Threshing in the Early 40's - by Jerry D. Coleman. How many of you can sit there and say that you have plowed with a mule? Well I would say not many, but maybe a few. This story is about the day my Grandfather Brown (true name) decided along with my parents to purchase a new Ford tractor. It wasn't really new except to us. The year was about 1967 and my father found a good used Ford 601 tractor to use on the farm instead of "Bob", our old mule. Now my grandfather had had this mule since the mid 40's and he was getting some age on him. S
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