Study: Mercedes Holds Highest Average Labor Costs Among US Manufacturers

Cameron Aubernon
by Cameron Aubernon
study mercedes holds highest average labor costs among us manufacturers

Who among all automakers has the highest labor costs in the United States? A study points to Mercedes-Benz.

According to Reuters, a study of 2014 labor costs by the Center for Automotive Research found that the automaker’s sole U.S. plant in Vance, Ala. averages $65/hour, while Volkswagen and BMW held the lowest averages overall and among the transplants, coming out to $38 and $39 per hour, respectively.

As mentioned previously, General Motors and Ford have the highest costs among the Detroit Three, averaging $58 and $57 per hour compared to FCA US’ $48. The three automakers are also the only ones whose employees are represented by the United Auto Workers, whose 2007 contract created the two-tier wage system meant to help the trio remain competitive against the transplants, as well as to stay afloat during the darkest days of the Great Recession.

Other automakers with business in the U.S. include Honda ($49/hr.), Toyota ($48/hr.), Nissan ($42/hr.), and Hyundai/Kia ($41/hr.).

The averages in the study were based on pay for both direct-hire and temporary employees working full-time. The research group also found that Japanese transplants had the highest percentages of temporary employees, helping to cut down on labor costs.

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5 of 11 comments
  • Sector 5 Sector 5 on Mar 25, 2015

    Percentage part time vs full for flexibility. Also saves on pension costs.

  • Corey Lewis Corey Lewis on Mar 25, 2015

    Just goes to show you, the machines matter more than the people making the cars, no matter how much you pay the people.

  • Turf3 Turf3 on Mar 25, 2015

    Unless you know how the numbers are calculated, they don't tell much. Which overhead items are included in each automaker's calculation? It is easy to envision that the Mercedes value could be the result of comparable fixed costs spread over a smaller number of workers; thus having little relationship to actual rate of pay.

    • Brn Brn on Mar 25, 2015

      Thank you. A respectable article will cite it's sources and provide such data. The Reuters article makes no attempt to do that. As such, we can't really conclude anything. Reuters (and to a lesser degree TTAC) know this, but don't care. They want you to jump to conclusions, without the necessary information. People jumping to conclusions helps their numbers.

  • Tekdemon Tekdemon on Mar 27, 2015

    Isn't MB's alabama plant known for all sorts of horrible quality issues though?