Originally Posted by garethmiller
Vw's are premium and mass market in much the same way as an Apple iPhone is. This would be a strange forum to say you can't be both.
I would argue that BMW are the premium mass market equivalent of Apple. VW as a marque are more mass market, less premium. Consider the VW Golf, at around 16k it doesn't sell in the UK for appreciably more than an equivalent hatchback from Purgeot - the 308 is also 16k. VW doesn't enjoy a special pricing position across all its models, but it is profitable as incidentally is much of the rest of the european car - Renault, Purgeot maybe even Fiat in a good year with a stiff breeze behind it.
Car makers haven't tended to build cars in China to export to Europe, they built them in cheap EU members. In fact looking at http://epp.eurostat.ec.europa.eu/sta..._in_motor_cars
is very interesting. It's old data (2008) but I don't have time right now to drill into their database for the recent numbers.
Even as Europe exports its cars primarily to wealthy markets they also import their cars primarily from wealthy markets. The bulk of our mass-market vehicles are built within the trading block, though they have obviously moved around within it - in much the same way that US production has migrated from Detroit to the South. This is why the Japanese makers built so much manufacturing capacity in the UK.
You say that UK car production is almost all Japanese production. Jaguar/Land Rover are owned by Indians, MG is owned by the Chinese. BMW build all the Mini's here in Oxford and also own Rolls Royce. Aston Martin are British owned and VW own Bentley. Virtually all of those are premium brands!. Even the Nissan factory is building the new expensively priced Leaf electric car. You are speaking without bothering to find out the real facts.
Current Japanese manufacturing within the uk is around 850k units which is more than all the other makers put together. Given how much of the employment in the industry is spread out among component manufacturers that's about the best proxy that we could find of importance from an employment perspective. Are others making more money in the UK? Perhaps, but since you are discussing moving manufacturing to high cost countries it's really employment that matters surely?
Italian labour productivity per person employed in 2009 was worse than Belgium, Ireland, France, Luxembourg, Austria and Norway within Europe and far worse than the United States.
Averaged across the whole country it's terrible, Il Mezzogiorno isn't a place you'd want to make anything, even though wages there are lower. When I made my comment about Italian productivity I was referring to Northern Italian productivity in clusters like the Veneto - which as an avid reader of the economist I'm sure you know are far more similar to German levels.
Are you saying Italy joined the Euro in 1995?, the currency didn't exist till 1999 and they agreed to join it in 1992 via the Maastricht Treaty.
Yes, I typoed there but even in 1995 it was already in the ERM, so the same forces applied. Lira/ECU was 2073 in Jan 1995 and 1942 by Dec 1998 - so actually stronger -ie. by the mid 90s the Italians had stopped depreciating their currency.
In any case the size of manufacturing in their economy could point to their failure to grow their service sectors in line with other nations.
The UK for example has built its entire economy on the financial services sector since the 1980's and this has been responsible for most of the GDP growth since that time.
Il Sorpasso famously took place in 1987, so at least until the early 90s Italy was growing faster than the UK - which would indicate that it was not just a failure to grow services but an active ability to grow manufacturing.
If you had paid attention to the news in the last week you would have known all this.
It's comments like that which make me think that
. I'm not sure you even believe what you are saying you just want a feeling of being superior, it isn't about sharing knowledge, it is about your ego.
The point that I was trying to make before you dropped a thousand links on everything I said was that industrial clusters can remain viable in rich economies, but that doesn't necessarily mean that all manufacturing can be easily moved back to them. Cars and aerospace are both great examples of highly sophisticated industrial products that are manufactured in the west - often at the cost of considerable state backing whether German style cheap finance, UK style development loans for Rolls Royce or US style military program padding for Boeing.
Trying to create a new consumer electronics cluster in the USA from scratch would be extremely expensive, and likely unsuccessful - it makes far more sense to build on the clusters that america already has.
DOUBLE EDIT: How many unnecessary insults will be in this reply coming. It has taken 20 minutes so far so my guess is 7. Sheesh
I realize that you think you're some terribly injured party being unfairly insulted and sneered at by a horrible egotist but I strongly recommend that you consider your own postings. My first post quoting you may have attacked your positions but it in no way insulted you. You began snarking with comments like 'But of course I bow to your economic mastery.' - and so I repayed you in kind by snarking right back. I'm quite comfortable with such tactics, or I'm quite happy with a reasoned discussion based on the facts - but if you want the latter you have to actually stick to it.