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How Many Americans Does it Take to Build a Jeep?

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ANNALS OF US MANUFACTURING
DailyFeed
According to White House data released earlier this month, the US auto industry almost looks like an actual business again.

"While American manufacturing continues to face substantial challenges, its future prospects are stronger than they have been in over a decade," reads a report titled "The Resurgence of the American Automotive Industry."

“Many people thought [the GM] bail-out (and a smaller one involving Chrysler, an even sicker firm) unwise," offered The Economist in August of last year. "Governments have historically been lousy stewards of industry. Lovers of free markets (including The Economist) feared that Mr. Obama might use GM as a political tool: perhaps favouring the unions who donate to Democrats or forcing the firm to build smaller, greener cars than consumers want to buy. The label “Government Motors” quickly stuck, evoking images of clunky committee-built cars that burned banknotes instead of petrol—all run by what Sarah Palin might call the socialist-in-chief... Yet the doomsayers were wrong."

The report makes special mention of Chrysler as a particularly helpless case:

With respect to Chrysler, the President faced a particularly difficult decision. After reviewing the business plan submitted by Chrysler in February 2009, it was clear that the company was weaker than GM – lacking a developed product pipeline or the international reach to compete in an increasingly globalized auto market. As a result, the President determined in March 2009 that Chrysler was not viable as a standalone company.

But now, after a post-bankruptcy restructuring and a partnership with Fiat, it's difficult not to be even the slightest bit impressed with Chrysler's resurgence -- and its subsequent effect on domestic employment:


(CLICK TO ENLARGE)

The center panel is key. Jeep Wrangler production at Chrysler's Toledo, Ohio plant alone directly employs 1,763 Americans, and Tier 1 suppliers for the Wrangler employ 3,000 more.

Wranglers source components from:

SEATS: Johnson Controls, Northwood, OH

STEERING COLUMN: Toledo Machine, Perrysburg, OH

COWL SCREEN: Tom Smith, Clayton, OH

HVAC: Denso, Battle Creek, MI

COOLING MODULE: Valeo, Greensburg, IN

TIRES: Goodyear, Union City, TN

AXELS: Dana, Dry Ridge, KY

FRONT END MODULE: Decoma, Toledo, OH

HINGES: Global Automotive Systems, Milan, MI

DOOR MODULE: Hi-Lex, Hudson, MI

DOOR HANDLES: Adac, Saranac, MI

EXHAUST: Benteler, Grand Rapids, MI

CARGO AREA: Int'l Auto Components, Holmesville, OH

GLASS: Pittsburg Glass Works, Crestline, OH

HARDTOP: Continental Structural Plastics, Carey, OH

FUEL TANK ASSY: Vitec, Detroit, MI

The effect has been felt outside the automotive sector, as well. As local economies rebounded alongside Chrysler's, small businesspeople like Steve Kinder and his son Blake, were also lifted by the rising tide and invested their money in a brand-new venture.

Of course, the operation should do well both when Chrysler is humming and, conversely, when times are tough.

And why not -- it's a bar.
POSITION:  No positions in stocks mentioned.

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