The payment of healthcare from U.S businesses will
always be an important factor and benefit for U.S. employees. On the other
hand, it could also negatively affect the comparative advantage of companies
when it comes to increase the cost of each vehicle. Meaning that this could put
ahead foreign companies in their market share.
In this case, U.S. car manufacture has a disadvantage
due to the huge amount of money they are investing in healthcare, rather than
investing it in other methods that can give the company the opportunity to grow
and be more innovated. They should have a balance between labor costs and
pensions they offer to their employees in order to maintain a competitive cost
to their customers.
It’s certainly obvious that not only healthcare and
high wages affected negatively the comparative advantage of U.S car manufacture.
There are a variety of factors that the Big Three are not applying in other to
compete with foreign companies such as: innovation on their processes to
motivate employees at lower cost, diversification of their products and
internal methods in order to be more productive.
We live in a highly competitive age, where everything
is about who is the best, who is first, and where each day companies create new
policies to increase their market share and revenue. Competition between
nations will develop over the time and new policies will be improve and others
will be enacted.
To conclude, companies should take advantage of new technologies
and be creative in order to maintain their position in todays globalized world.
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