President Obama To Tout Auto Industry In Kansas City

Photo courtesy of Wikimedia Commons
Ford's production plant in the Kansas City area added a third shift last month and will begin production of the company's Transit van early next year. | Photo courtesy of Wikimedia Commons

President Barack Obama was scheduled to speak today to workers at Ford Motor Co.’s Claycomo assembly plant in suburban Kansas City, which is celebrating its 100-year presence in the area and recently announced major production expansions. U.S. Sen. Claire McCaskill and Gov. Jay Nixon planned to join  the president to tout the auto industry in Missouri. The event will not be open to the public.

“We’ve seen tremendous renaissance in Missouri over the last few years of automobile manufacturing jobs, and jobs of automotive suppliers,” said Scott Holste, spokesman for Gov. Jay Nixon.  Obama comes to Kansas City “in recognition of the resurgence of the automobile industry specifically in Missouri,” Holste said. “It’s highlighting the good things that are happening in Missouri in the automobile industry.”

In June, General Motors approved a $380 million expansion of its Wentzville plant, adding 1,660 jobs. Ford last month added a third shift of 900 workers at its plant in Clay County outside Kansas City, where F-150 trucks are assembled.  Ford will start building its Transit van at the Claycomo plant in early 2014, bringing the number of new workers to 2,000.

Overall, the automotive industry supports more than 99,000 jobs in Missouri, Kim Hill from the Center for Automotive Research said during a panel earlier this month at the Governor’s Conference on Economic Development.

As of 2012, there were 412 new-car dealers in Missouri, ranking 15th in the nation. Their total sales of $13.1 billion ranked 18th.

“As more and more consumers purchase automobiles after the downturn that we saw a few years ago, more and more people are coming back to the automobile market,” Holste said. “We are very glad that a lot of those vehicles were either made in Missouri or have a significant part that’s made in Missouri.”

However, the number of auto manufacturing jobs in Missouri now, about 4,100, is still well below the number in in early 2003, about 17,800, according to Bureau of Labor Statistics.

An incentives package for automotive manufacturing that includes tax breaks was approved in the state in 2010.

“We’ve come a long way (since) when things kind of bottomed out in 2008,” Holste said. “Missouri is on the leading edge of the resurgence of the automobile industry in the U.S.”

Turnaround: Auto sales hit six-year peak

In July, Detroit, the city most associated with the auto industry, filed for Chapter 9 bankruptcy with an estimated $18 billion liability. However, a surge in sales data in August shed a silver lining of the automotive industry around the nation, with General Motors, Ford and Chrysler — the “Big Three” — all reporting double-digit increases in sales.

Seasonally adjusted cars and trucks sales number exceeded 16 million in August, boasting the highest selling rate since 2007. The number is 17 percent more than August last year.

“The auto industry went through a very significant 40 percent decline during the crisis years of 2008 and 2009, and was artificially low,” said Dietmar Ostermann, global automotive advisory leader at PricewaterhouseCoopers. “The auto industry has been recovering since 2009. Each of those recoveries was about 10 percent year over year. That barely catches up all the ground that was lost.”

In August, motor vehicle and part manufacturing in the U.S. created 19,000 jobs. After a 10,000-job loss in July, many laid-off workers returned to production lines. There was an 18.8 percent  increase in employment on a year-on-year basis in the industry. Over the past 12 months, auto manufacturers have added 34,300 jobs.

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