The Other Side Of The Bailout Story: HONDA

On Monday, Honda (HMC) celebrated the opening of its $550-million, nonunion plant in Greensburg, Indiana, capable of producing 200,000 vehicles annually, highlighting the contrast between the healthy Asian automaker and its ailing domestic rivals.

And even though the starting hourly wage at the plant is $18.41, or roughly $10 less than an average Detroit Three worker, demand for these jobs was off the charts. When Honda announced it was hiring 900 employees, 33,000 people applied. Honda eventually plans to employ about 2,000 at the plant, which started production in October.

Honda’s Greensburg plant will give the company a competitive advantage compared with many of the Detroit Three’s aging plants and higher labor rates, said Gary Chaison, a professor of industrial relations at Clark University in Massachusetts.

“The Honda plant is the other side of the bailout story,” Chaison said. “These are companies which are still expanding and which have lower cost structures. They are also facing the world financial crisis, but they are in much better shape.”

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