Supply Chain Management / Lean Six Sigma

As Trump emphasizes manufacturing jobs, how important are labor costs for automakers?

By NBC News

Feb 07, 2017

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American consumers pay an average of $35,000 for their new car, truck, or crossover. But what does that sum actually cover? And with President Donald Trump's border tax threats that could add 20 percent to the price of any car manufactured outside America, exactly how crucial are labor costs to consumers — and automakers?

Labor is nowhere near the most expensive part of building a car. Add in all factory costs, including the $1 billion price tag for the plant itself, and you're looking at roughly 10 to 15 percent of that vehicle's $35,000 sticker price, according to several senior industry executives who asked to remain anonymous in revealing typically proprietary data.

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