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We decided to do more than just rescue the industry from crisis. We decided to retool it for a new age. We said that if everyone involved was willing to take the tough steps and make the painful sacrifices that were needed to become competitive, then wed invest in your future and the future of communities like Toledo; that wed have your back. So I placed my bet on you. I put my faith in the American worker. And Ill tell you whatIm going to do that every day of the week, because what youve done vindicates my faith.
- President Barack Obama, June 3, 2011
In the winter of 2009, the American auto industry was on the brink of collapse. Rocked by the economic crisis, the Big Three automakers had lost a staggering $62 billion in 2008 alone.1 Private lenders were unwilling to provide any funds, leaving GM and Chrysler unable to operate. The struggles of the automakers put the Ohio economy at risk. Nearly 120,000 Ohioans are employed in making motor vehicles and parts, and independent analysts estimate that almost 848,000 Ohio jobsone in every eight Ohio workersdepend directly or indirectly on the auto industry.2 In the month the President took office, over 15,000 Ohioans lost jobs in motor vehicles and parts manufacturing.3 Thanks to the auto rescue led by the president, U.S. automakers are once again profitable, growing, and making cars that excite our dreams. All told, the industry has gained over 217,000 jobs since GM and Chrysler exited bankruptcy in June 2009.4 Today in Toledoa city that has been building motor vehicles for over a centuryVice President Joe Biden will describe the presidents decisive actions and the impact they have had in Ohio. A resurgent auto industry is a central part of the Obama-Biden Administrations ambitious agenda to strengthen American manufacturing, make hard work pay, and build an American economy meant to last.
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Sources: Ohio Department of Development, The Ohio Motor Vehicle Industry, February 2011; Center for Automotive Research, Contribution of the Automotive Industry to the Economies of All Fifty States and the United States, April 2010.
The resurgence of the American auto industry is leading the auto companies to invest more in Ohio and hire more Ohioans: GM: Three years ago, only one shift of workers was needed at GMs Lordstown plant. Today, 4,500 employees staff three shifts at Lordstown, and GM has poured $350 million in new investments into the plant.9 Since the recovery, GM has also invested hundreds of millions of dollars and is creating hundreds of jobs at plants in Defiance and Toledo.10 Chrysler: Today, 70 percent of parts in the Jeep Wrangler are American-made, up from 45 percent several years ago. American-made parts include glass made in Crestline, steering columns from Perrysburg, seats from Northwood, hard tops from Carey, and cargo components from Holmesville.12 Chrysler recently announced it was adding a second shift at its Toledo complex, adding 1,100 jobs in 2013.13
Honda: The Honda plant in Marysville is one of the largest in the United States, producing over 340,000 vehicles in 2010.14 Honda recently invested $98 million in their auto engine plant in Anna, part of their efforts to create 1,200 jobs across the U.S.15
The result has been a stronger American auto industry. Chrysler and GM have repaid their outstanding loans in full years ahead of schedule.21 GM has reclaimed its title as the worlds largest automaker, and in 2011, GM, Chrysler and Ford all gained market share for the first time in decades.22 As the economy strengthens, more Americans are buying autos. Annualized February US sales stood at 15.1 million vehicles, including 11.4 million domestic cars and trucks.23 And automakers and part suppliers are hiring in Ohio and across the country, with 217,000 auto industry jobs created since GM and Chrysler exited bankruptcy in June 2009.24
PAID FOR BY OBAMA FOR AMERICA
Other Republican candidates agree. Speaker Newt Gingrich has called the Presidents actions a mistake.30 Senator Rick Santorum said all the rescue did was pay off a special interest.31 Santorum argued that the rescue package gave GM and Chrysler to the unions, even though workers made significant concessions and the union itself owns no GM or Chrysler stock.32 Congressman Ron Paul said, it wont work. It cant work.33 In the depths of the financial crisis, there was no alternative to government financing. As bankruptcy expert Harvey Miller said this week, it was very unlikely that GM or Chrysler could have survived without government support. Without the debtor-in-possession financing, they would have had to shut down. The court ruled there was no possibility for DIP financing except from the government. The Republican candidates are ignoring this. Ive watched the debates. The misstatements are so shocking.34 If the Republican candidates for president had got their way, there would be no American auto industry today. The Republican candidates plans for the future echo their positions on saving the auto industry. They would fail to invest in American manufacturers. While their plans include massive tax cuts favoring millionaires, billionaires and large corporations. While they would drive up the deficit, they would also require steep cuts in critical investments like community colleges, infrastructure, secure and affordable energy sources, and innovation and scientific research in order to balance the budget. The Republican candidates offer no plans to make American manufacturers competitive.
400,000
Total number of Ohioans working throughout the auto industry supply chain 1
500,000
Number of cars built in Ohio in 2010thats one-sixth of U.S. output 1
$53,700
Average yearly salary for workers in Ohios auto industrycompared to private sector average of $38,500 1
MAP KEY = Establishments in Ohios Motor Vehicle Industry believed to employ 500 or more
TOLEDO
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AVON L A KE
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N LORDSTOW
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A NNA
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ANNA, OHIO | Honda recently invested nearly $100 million in their Anna, Ohio auto engine plant. 2 TOLEDO, OHIO | Chrysler is adding a second shift at its Toledo complex, creating 1,100 jobs. 3 AVON LAKE, OHIO | Ford is insourcing an assembly operation, upgrading its plants and keeping 1,900 jobs in Ohio. 4 LORDSTOWN, OHIO | GM has invested $350 million and started a third shift. Today, the plant employs 4,500 Ohioans. 5
$18.6 BILLION
Amount added to the economy through services related to the Ohio auto industryfrom warehouses to retail stores to repair shops.1
848,000
Ohio jobs depend directly or indirectly on the auto industryand those are jobs that are now secure thanks to the auto industrys recovery. 6
President Obama made the tough decision to rescue Americas auto industrywhich supports ONE OUT OF EIGHT JOBS in Ohio.
Chrysler has repaid all outstanding Obama Administration loans in full and GM has repaid $24 billion. Today, the Big Three are all posting profits for the first time in SEVEN YEARS.7
WHERE WE WERE
The United States lost over 250,000 motor vehicles and parts manufacturing jobs in 2008. 8
TODAY
The U.S. auto industry has added more than 210,000 jobs since June 2009, and is expected to create 167,000 new jobs over the next four years.10
SOURCES: 1 Ohio Development Report, 02/2011; 2 Industry Week, 2/1/12 & UPI, 2/19/12; 3 Toledo Blade, 8/10/11; 4 Cleveland Plain Dealer, 12/6/11; GM Press Release, 2/23/10 & Dayton Daily News, 2/6/12; 6 Center for Automotive Research, 04/2010; 7Associated Press, 5/2/11 & U.S. Department of the Treasury, Daily TARP Update 3/12/12; 8 BLS.gov, accessed 3/13/12; 9Washington Post 44 Blog, 2/28/12; 10 New York Times, 11/29/11 & Bureau Of Labor Statistics, Accessed 3/9/12
ENDNOTES
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Bloomberg News, GM Posts $30.9 Billion Loss as Wagoner Seeks New Aid, 2/26/2009; New York Times, Plants, Says It Lost $16.8 Billion in 2008, 4/30/09.
Ford Reports a Record $14.6 Billion Loss for 2008, 1/29/09; and Detroit News, Chrysler to Close Eight
Center for Automotive Research, Contribution of the Automotive Industry to the Economies of All Fifty States and the United States, April 2010.
Bureau of Labor Statistics data, accessed 3/13/12. Bureau of Labor Statistics data, accessed 3/13/12. Ohio Department of Development, The Ohio Motor Vehicle Industry, February 2011. Ohio Department of Development, The Ohio Motor Vehicle Industry, February 2011. Center for Automotive Research, Contribution of the Automotive Industry to the Economies of All Fifty States and the United States, April 2010.
Ohio Department of Development, The Ohio Motor Vehicle Industry, February 2011. Gov. John Kasich and Dan Akerson, Foxnews.com op-ed, GM and the US auto industrys remarkable comeback is about more than just money, 2/28/12.
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GM Press Release, GM to Invest $890 Million to Build Cleaner, More Fuel-Efficient Engines, 4/27/10 Bloomberg, GM Will Invest $2 Billion in U.S. Plants, 5/10/11.
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Cleveland Plain Dealer, Ford Investing $128 Million in Avon Lake Plant, 12/6/11. Senator Sherrod Brown, Brown Highlights Trends in U.S.-China Auto Parts Trade: U.S. Auto Parts Deficit with China Grew to $10.2 Billion in 2011, 1/8/12.
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Toledo Blade, Jeep Expansion to Add 1,100 Jobs, 8/10/11. Ohio Department of Development, The Ohio Motor Vehicle Industry, February 2011. UPI, Auto Outlook: Survey Shows U.S. Automakers Improved, 2/19/12. The White House report, The Resurgence of the American Automotive Industry, 6/1/11. The White House report, The Resurgence of the American Automotive Industry, 6/1/11. The Center for Automotive Research, The Impact on the U.S. Economy of the Successful Automaker Bankruptcies, 11/17/2010; Robert E. Scott, When Giants Fall: Shutdown of One or More U.S. Automakers Could Eliminate up to 3.3 Million U.S. Jobs, 12/3/2008; Mark Zandi, Philadelphia Inquirer op-ed, Bailing Out Detroit, 2/26/12.
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The White House report, The Resurgence of the American Automotive Industry, 6/1/11. The White House fact sheet, Obama Administration Proposes Historic Fuel Economy Standards to Reduce Dependence on Oil, Save Consumers Money at the Pump, 11/16/11
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SIGTARP Office of the Special Inspector General for the Troubled Asset Relief Program, Quarterly Report to Congress, 1/26/12
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New York Times, Good Year for Autos, but a Test Waits in 2012, 1/4/12. Reuters, Table: February U.S. Auto Sales 15.1 Million Annualized Rate, 3/1/12.
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Bureau of Labor Statistics data, accessed 3/13/12. Bureau of Labor Statistics data, accessed 3/13/12. Census Bureau, December 2011 Mitt Romney, New York Times op-ed, Let Detroit Go Bankrupt, 11/18/08. Mitt Romney, The Corner Blog on the National Review Online, From Bad to Worse, 4/29/09. Real Clear Politics, Romney Faces Michigan Test on Auto Bailout Stance, 6/9/11. Newt Gingrich and Jim Frogue, McClatchy-Tribune op-ed, Another Medicaid Bailout, 2/9/09.
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National Journal, Santorum Slams Obama Hubris and Snobbery, 1/7/12. Politifact, Mitt Romney Says Obama Gave Away Car Companies to Union, 2/27/12. Congressman Ron Paul, House office web site, The Bailout Surge, accessed 3/13/12 New York Times, When Debating the Auto Bailout, Consider Lehmans Fate, 3/9/12. See also Congressional Oversight Panel, January Oversight Report, 1/13/11; Mark Zandi, Testimony before the Senate Banking Committee, 12/4/08; and The Daily Beast, Ford CEO Alan Mulally on the Auto Bailout, Electric Cars, 10/16/10.
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