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Chennai Is the New Detroit

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Ford, Hyundai, and Michelin are investing billions in new, top-of-the-line factories in India. However, for Chennai to really become more like Detroit, it'll need to do more. A lot more.

On Slate's "The Big Money" blog, Kelly Faircloth writes:

"India is now on the radar as one of the two most important markets for Ford strategically world-wide," says the managing director of Ford’s (F) Indian operations. The boom in automaker interest has created more than 200,000 jobs, many of them in India’s underdeveloped gap between agriculture and high-level tech work. The city will soon be manufacturing 1.5 million cars a year.

Yeah, okay, I mean, that's all well and good and whatever, but that doesn't make Chennai anything resembling Detroit at all.

For starters:

CHENNAI: 10.7 percent unemployment

DETROIT: 50 percent unemployment. (Officially, Detroit's unemployment rate is just under 30 percent. But the  city's mayor and local leaders say the actual jobless rate is closer to 50 percent.)

VERDICT: Chennai's going to have to try a lot harder to raise its joblessness rate if it wants to keep pace with the Motor City.


CHENNAI:
Property prices have seen an escalation of almost 200 per cent in the last few years.

DETROIT: A new report ranks Detroit as the 'Lowest Performing' real estate market in the country.

VERDICT: Get on the stick, Chennai. Pull the rug out from under that housing market, or you'll never be like Detroit.


CHENNAI: 14.59 per cent increase in murder and property crimes in 2009

DETROIT: Murder rate up 12 percent in 2009

VERDICT: Good going, Chennai! You're making progress!

Maybe Chennai really can become the new Detroit.
POSITION:  No positions in stocks mentioned.
TAGS:  INDIA, DETROIT, AUTOMOTIVE, CHENNAI    SOURCE:   The Big Money
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