It’s unusually difficult to be dead weight on an assembly line. There’s definitely more and less effective employees inside of auto companies, but when you can directly measure productivity people can only slack so much.
Rather than competition the larger story is companies trying to managing the EV transition. It’s inherently difficult when most buyers are still choosing ICE but EV’s need huge R&D investments and are generally unprofitable. We just entered the territory where sales aren’t small enough to simply absorb per unit losses as irrelevant.
>It’s unusually difficult to be dead weight on an assembly line
I never said the dead weight is on the assembly line, because it's never there, it's in the offices and board rooms. VW for example is full of useless employee swinging their nutsacks (German expression for doing nothing) and cashing in near six figure wages and being unfireable. Meanwhile the workers on the assembly lines will have to loose their jobs.
Well yeah, a bumper on a car being bolted by a German worker is not gonna be held on better than if it were bolted by a Chinese worker. Germans can't compete with Chinese on a assembly lines. The advantage western manufacturing used to have to compensate for expensive labor was automation but guess what, China also has automation now in factories now. So what's gonna be VWs answer?
As crazy as it sounds if you know anything about the industry, better management and increasing wages in China.
Chinese firms are generally extremely dysfunctional internally. That didn’t matter when they paid people a small fraction of western wages, but significant wage growth for years adds up. Continue ~9%/year wage growth and things would be at near parity in a little over a decade.
Obviously, that’s no guarantee but rapidly developing countries eventually develop. Things are about to get really interesting.
Rather than competition the larger story is companies trying to managing the EV transition. It’s inherently difficult when most buyers are still choosing ICE but EV’s need huge R&D investments and are generally unprofitable. We just entered the territory where sales aren’t small enough to simply absorb per unit losses as irrelevant.