http://www.businessweek.com/bwdaily/dnflash/content/dec2008/db20081221_299079.htmAuto Bailout: Southern Workers Watch and Worry
Autoworkers at Honda's Lincoln, Ala., plant support a Detroit rescue more than their politicians do. They have reason to fear cuts, too By Brian Burnsed
Top News December 21, 2008, 9:49PM EST
The tiny town of Lincoln, Ala., is 706 miles from Detroit. But as the U.S. recession deepens, the distance between this Southern enclave of the American auto industry and the Big Three's headquarters to the North seems to be shrinking.
At the edge of the 4,500-resident town looms a massive Honda plant, marked only by two tall towers bearing the Japanese automaker's name and by the sounds of industry that drift into Lincoln on otherwise sleepy afternoons. The plant, which opened in 2001, makes Honda Odyssey minivans and Honda Pilot SUVs.
Like other "transplant" factories set up by Japanese, Korean, and European companies in the South, the Lincoln Honda plant has no union, reflecting a wariness in the region about a typically Northern institution. Many in the South feel that General Motors (GM), Ford Motor (F), and Chrysler—and their unionized workers—have no one but themselves to blame for their difficulties. That opinion came through loud and clear during the debate that left Congress killing a legislative bailout of the Detroit car companies. Sen. Richard Shelby (R-Ala.) blasted the Detroit companies as "dinosaurs" and the bailout legislation as "a bridge loan to nowhere."
Yet it was also clear in a visit to Lincoln on Friday, Dec. 19—the day that President George W. Bush announced he was extending a $17.4 billion lifeline to GM and Chrysler—that some workers and residents here think the woes of the auto industry are not entirely due to mismanagement or the high costs of pensions and health care for Detroit's retirees.
Stalled Foreign automakers
The souring U.S. economy is hurting the Japanese companies to which Detroit automakers are so frequently and unfavorably compared. Honda has been cutting production to match its plummeting U.S. sales, and its leaders in Japan are sending ominous signals that things are expected to get worse in 2009. On Dec. 17, Honda CEO Takeo Fukui said the company probably will earn 62% less this fiscal year than what it had projected just six weeks earlier. That sense of alarm was reflected in the latest November results, which showed Honda's U.S. sales were down 32%, roughly in line with declines at other companies.
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