Insourcing back at 'Big Three' automakers

DEARBORN, Mich., Feb. 15 (UPI) -- Outsourcing, a trend that has taken U.S. automakers on a global search for cheaper parts will, in part, be headed back home, a report said Friday

Ford Motor Co. will be the first of Detroit's Big Three to assembly some of its parts in house, starting with instrument panels, which Ford will make for the Taurus and the new Lincoln MKS sedans in the spring of 2008.

The industry has increasingly turned to China, Mexico and other countries for outsourcing contracts.

Now, "we are convinced that an insourcing trend is emerging," John Murphy, an industry analyst with Merrill Lynch told the Detroit Free Press.

Insourcing is now viable, as a new four-year contract with the United Auto Workers has dropped starting wages to $14 an hour, competitive with currently outsourced contracts both in the United States and abroad, the newspaper said.

Moreover, union contracts stipulate that Ford insource to provide 1,500 jobs, General Motors Corp. 3,000 jobs and Chrysler LLC 1,025 jobs.

Ford has even agreed to open its books to the union, so that, essentially, companies bidding for parts contracts at Ford will be bidding against the UAW, the report said.