The Southern Auto Rebellion Could Upset Your Portfolio
An End to the Easy Ride
For decades, foreign carmakers have enjoyed a rather cushy deal in the American South. They built shiny factories, hired non-union workers for less pay than their Detroit rivals, and churned out cars with a healthy cost advantage. It was a brilliant strategy, really. But it seems the music might be stopping. The United Auto Workers’ recent victory at a Volkswagen plant in Tennessee is not just a small win, it’s a shot across the bow for the entire industry. I think we are witnessing the beginning of the end for the South’s status as a low-cost sanctuary for global auto giants. This cosy arrangement, which has propped up profit margins for years, is now facing a proper rebellion.