Foreign Auto Plants Have Received $3.6 Billion in Subsidies, Mostly From Southern States

[1gobluedem]

Cross posted from Editorials and Articles

Foreign Auto Plants Have Received $3.6 Billion in Subsidies, Mostly From Southern States

WASHINGTON, Dec. 12 /PRNewswire-USNewswire/ -- Responding to many queries, Good Jobs First today released its summary of state and local subsidies given to foreign-owned auto assembly plants, totaling $3.6 billion.

"As elected officials debate aid for the Big 3, taxpayers have the right to know the full extent of government involvement in America's auto industry," said Greg LeRoy, GJF's executive director. "And while proposed federal aid to the Big 3 would take the form of a loan, the vast majority of subsidies to foreign auto plants were taxpayer gifts such as property and sales tax exemptions, income tax credits, infrastructure aid, land discounts, and training grants," he said.

Honda, Marysville OH, 1980, $27 million*

Nissan, Smyrna, TN, 1980, $233 million**

Toyota, Georgetown, KY, 1985, $147 million

Honda, Anna, OH, 1985, $27 million*

Subaru, Lafayette, IN, 1986, $94 million

Honda, East Liberty, OH, 1987, $27 million*

BMW, Spartanburg, SC, 1992, $150 million

Mercedes-Benz, Vance, AL, 1993, $258 million

Toyota, Princeton, IN, 1995, $30 million

Nissan, Decherd, TN, 1995, $200 million**

Toyota, Buffalo, WV, 1996, more than $15 million

Honda, Lincoln, AL, 1999, $248 million

Nissan, Canton, MS, 2000, $295 million

Toyota, Huntsville, AL, 2001, $30 million

Hyundai, Montgomery, AL, 2002, $252 million

Toyota, San Antonio, TX, 2003, $133 million

Kia, West Point, GA, 2006, $400 million

Honda, Greensburg, IN, 2006, $141 million

Toyota, Blue Springs, MS, 2007, $300 million

Volkswagen, Chattanooga, TN, 2008, $577 million

Total: more than $3.58 billion

* total of direct subsidies to all Honda facilities in Ohio

** includes about $200 million for expansions of Smyrna and Decherd plants

List does not include joint ventures with U.S. companies

These data, drawn primarily from contemporary media accounts, are very conservative. They do not account for inflation; some would be worth far more in today's dollars. They do not include any estimate of subsidies granted to hundreds of foreign-owned auto supply companies that have located in the same areas, virtually all of which were also heavily subsidized. Finally, they do not reflect later news accounts, which often place higher subsidy values.

Good Jobs First is a non-profit, non-partisan research center promoting best practices in economic development and smart growth, based in Washington, DC, with offices in New York and Chicago.

© 2008 PR Newswire. All Rights Reserved

[Nicholas D Wolfwood]

1. Yet another instance in our history where the south sides with foreign interests. (nt)

[LisaM]

2. K&R

:kick:

[madrchsod]

3. oh my, you`re going to blind people with the truth....

remember thosew who work for those companies are subsidizing universal type health care in those countries. are working for less than those workers in the "home" country. last but not least--profits do not stay in this country...

[Cessna Invesco Palin]

4. Hmm... interesting.

So foreign automakers have been subsidized to the tune of something like 1/7th of what GM and Chrysler are asking for to keep them afloat for a couple of months.

[Sultana]

5. Traitors

:grr:

[gorfle]

6. I, for one, am greatful.

I live in Alabama, home to Hyundai, among others.

These businesses can set up anywhere in the world they want to. It is in fact the duty of states to seek out such businesses and encourage them to set up shop with them, to the benefit of workers in their states.

This sort of thing is done all the time. When they put in a new Bass Pro Shops in Albama, they split the sales tax revenues with them for some period of time.

The fact is, if you want to encourage businesses to set up shop in your area, you have to give them a reason to do so.

Michigan should be bailing out their auto industries if they want to continue to reap the benefits of having those industries.

[navarth]

7. I take it you are not for helping the auto companies?

is that correct?

[gorfle]

8. No.

Like I said, I think just like Alabama has taken steps to encourage and preserve business development within its borders, so Michigan and related states should take steps to encourage and preserve the Big Three in their states.

Also, many of the foreign competitors have effectively been subsidized by social health care and retirement benefits, and so some subsidy is probably in order for our car manufacturers who have had to unfairly compete.

I think rather than handing them cash loans I would rather see tax breaks and incentives. This way the taxpayer is not actually out any money should they fail anyway.

[navarth]

9. one of the steps they've taken is to shut out the unions.

do you agree with that?

[LisaM]

10. How could they not?

Otherwise, this argument wouldn't be taking place.

The anti-union stance of many DUers is a very curious thing.

[navarth]

11. yep

I'm still waiting for that answer from Alabama.

[LisaM]

12. Good luck on that.

But thanks for pointing it out.

[Cessna Invesco Palin]

13. Your argument doesn't make much sense.

GM doesn't need tax breaks - it needs a capital infusion and restructuring. It's also worth nothing that most if not all foreign manufacturers with plants in the US support the bailout for the simple reason that they use many of the same parts suppliers, who are liable to go under if one or more of the big three kick the bucket.

I think rather than handing them cash loans I would rather see tax breaks and incentives. This way the taxpayer is not actually out any money should they fail anyway.

What, exactly, do you think a tax break is? The taxpayer is certainly out some kind of money when a tax break is given. In the ideal world the revenue lost by giving tax breaks to businesses is made up for by increased tax revenue from other sectors which are supported by bringing in the new business.

The failure of one or more of the big three will negatively impact your Hundai plant, will negatively impact federal and state spending on unemployment benefits, and may very well make it difficult for multi-brand dealerships to stay in business.

[DainBramaged]

14. Good, Alabama PAID $250,000 PER JOB wih YOUR tax money

in give aways, you must love to piss away money.

[Romulox]

15. Still waiting for ANY of DU's Big 3 critics to comment on this. nt