'Transplant' auto factories in USA turn 30 this year
— -- When Honda Motor in 1980 announced its then-radical decision to build cars in the U.S., the industry collectively said, "What?"
Volkswagen, alone among foreign car companies, was trying limited U.S. production, assembling Rabbit compacts at a Pennsylvania factory, and struggling to get it right.
While auto buyers now take for granted that many European- or Asian-brand vehicles are made in the heart of the U.S., 30 years ago, it was a stunning notion.
Japan's Honda was "the canary in the coal mine," says John Voorhorst, a consultant and retired executive of auto-parts supplier Denso. "There were a lot of skeptics" betting Honda's plant at Marysville, Ohio, wouldn't last.
In fact, that "transplant" factory, which built its first Accord in November 1982, burst a dam. Within a few years, Japan's major automakers all were here cranking out new vehicles.
At the New York International Auto Show, opening to the public Friday, Honda will display new versions of the Accord, and Nissan will unveil a redesigned Altima — both made in the U.S. and among its best-selling cars. Toyota will show a successor for Avalon, its U.S.-made big sedan based on the U.S.-made Camry.
"Once (Honda) had the trial by fire and came through, clearly, it emboldened others. It was the opening of the floodgates," Voorhorst says. Foreign companies "saw that you could come here and not have to have a Volkswagen-esque experience."
In the three decades since, Japanese carmakers have opened more assembly and parts factories here, joined by Europeans and South Koreans.
The industrial immigrants haven't been welcomed by all.
A decade ago, about 51% of vehicle and parts manufacturing jobs were clustered in Michigan, Ohio and Indiana, traditional turf of the Detroit Three. Workers were mostly represented by the United Auto Workers.
Now, there are fewer than half as many total automaking jobs as a decade ago, and Michigan, Ohio and Indiana have just 44% of those left, according to data from the Center for Automotive Research. Many of the jobs now are in foreign-owned, non-union transplant facilities, mainly in the South.
About the time Honda opened its pioneering plant, General Motors, Ford Motor and Chrysler Group accounted for three-quarters of new vehicles sold in the U.S. That's about 47% now.
Foreign automakers with U.S. factories, in comparison, have about 48% of all new vehicle sales here, according to industry tracker Autodata.
While the foreign-brand sales include both imported and U.S.-built vehicles, the robust market share has encouraged the companies to build cars here.
Today, 10 foreign-based car companies operate 16 big assembly plants in the U.S. and others in Canada and Mexico, building for North America and for export. They also now make engines, transmissions and other key components in the U.S.
Despite that now-proven success, it would have been easy to bet against Honda 30 years ago:
•VW's converted Chrysler factory at Westmoreland County, Pa., was stumbling toward failure. It closed in 1988.
•U.S. buyers' love affair with import brands hadn't bloomed.
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