Wednesday, 27 February 2008
German automakers seek cost reductions, hope to increase use of North American based parts
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With a Euro-dollar exchange rate that continues to shift in the direction of weaker American currency, German automakers are understandably searching for methods of shifting costs away from the strong Euro. Why buy parts and manufacturing at Euro prices and sell finished product for American dollars?
Of course, German car companies will continue selling at American prices – and competitive ones if they hope to succeed. So the strategy now is to substitute more dollar based North American parts (and manufacturing processes) in place of expensive Euro-sourced components. According to an Automotive News report, SUVs like the Mercedes-Benz ML, Mercedes GL and next generation Audi Q7 are potential candidates for American parts applications. Both Mercedes models are already built in Tuscaloosa, Alabama.
Source: Automotive News [Subscription required]
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