59 51 ANTECEDENT CONDITIONS United States and Canadian Automotive Production, Consumption and Trade Flows Prior to 1965 United States and Canadian automotive production and consumption the United States-Canadian automotive agreement, General Motors, Ford, Chrysler and American Motors (the Big Four) were by far the major motorvehicle producers in both the United States and Canada. In 1964, in terms of quantity, they accounted for 99.9 percent of the passenger cars and 86.6 percent of the trucks and buses produced in the United States; corresponding figures for Canada were 96.8 percent and 89 percent, respectively. 1/ Passenger-automobile final-assembly plants were located in 18 states. Passenger-automobile producing states and their shares of 1964 United States production in terms of quantities were: Michigan (33.9 percent), Missouri (11.1 percent), California (9.5 percent), Wisconsin (7.8 percent), New Jersey (6.9 percent), Ohio (5.1 percent), Georgia (5 percent), Delaware (4.8 percent), Texas (2.7 percent), New York (2.4 percent), Kansas (2.4 percent), Maryland (2 percent), Illinois (1.9 per cent), Massachusetts (1.4 percent), Minnesota (1.3 percent), Kentucky (1.1 percent), and Virginia (0.8 percent). Indiana had been a produc ing state throughout the post-World War II period until 1963, when its passenger-automobile production terminated. Trucks and buses were produced in the United States by many firms in addition to the Big Four. Of the 17 firms other than the Big Four See tables 25, 29, 67, and 69 of this report. 60 52 that remained in 1964, the major producers were International Harveste White, and Mack. Together, these three companies accounted for 12.9 percent of the total number of trucks and buses produced in the United States. 1/ Truck and bus production was located in 18 states in 1964. Those states, and their shares of U.S. truck and bus output in 1964, were as follows: Michigan (25 percent), Ohio (22 percent), Missouri (12 percent), Indiana (4 percent), California (11 percent), New Jersey (6 percent), Wisconsin (4 percent), Georgia (2 percent), New York (3 percent), Kentucky (3 percent), Maryland (2 percent), and Texas, Virginia, Pennsylvania, Minnesota, Connecticut, Oregon, and Illinois (one percent or less each). In Canada six companies manufactured nearly all the passenger cars produced in that country during the post-World War II period prior to 1965; they were, in addition to the Canadian affiliates of the Big Four Studebaker, and Swedish-owned Volvo (which became established in Canada in 1963). In addition to General Motors, Ford, and Chrysler, the only Canadian truck producer of major significance was International Harveste In 1964, International Harvester accounted for approximately 11 percent of the number of trucks produced in Canada. 2/ A number of smaller firm in Canada, some United States-owned or controlled, made trucks and buse Virtually all Canadian production of passenger automobiles, trucks, and buses was concentrated in the province of Ontario prior to 1965, although Nova Scotia also produced 'some passenger automobiles; some trucks were also produced in British Columbia prior to 1965. 1/ See table 67 of this report. 2/ See table 69 of this report. 61 53 Passenger automobiles have comprised the bulk of motor-vehicle production in the United States and Canada since World War II. By 1960, U.S. production of passenger automobiles numbered 6.6 million units, increasing in 1964 to nearly 7.7 million units. 1/ Canadian production of passenger automobiles totalled 325,000 units in 1960 and 557,000 units in 1964. 2/ In terms of the numbers produced, Canadian production of passenger automobiles constituted 4.6 percent of total United StatesCanadian production in 1960 and 6.7 percent in 1964. 3/ In 1964 Canadian production of motor vehicles was the highest that it had ever been in Canadian automotive history. Trucks and buses have accounted for a substantial share of United States-Canadian motor-vehicle production during the post-World War II period. In 1960, U.S. production of trucks and buses numbered nearly 1.2 million units, increasing in 1964 to 1.6 million units. 4/ Canadian production of trucks and buses increased from 70,000 units in 1960, to 109,000 units in 1964. 5/ Canadian production of trucks and buses accounted for 5.5 percent of total United States-Canadian production in 1960, and 6.5 percent in 1964. 6/ Although United States production of trucks and buses was at an all-time record level in 1964, Canadian production of such vehicles in 1964 was substantially lower 1 See tables 24 and 91 of this report. 2 See tables 28 and 92 of this report. 3/ See table 35 of this report. 5/ See tables 68 and 92 of this report. See tables 66 and 91 of this report. 6/ See table 72 of this report. 62 54 than it had been during the early 1950's. In 1952, Canada had accounte for 11 percent of United States-Canadian production of trucks and buses Since the production of completed vehicles is dependent upon the production of original-equipment parts, and such parts make up 65-75 percent of the cost of such completed vehicles, the original-equipment parts industry is a necessary component of the automotive industrial complex in the United States and Canada and the value added by manufacture in this industry is far greater than the value added by the assembly of motor vehicles in the United States and Canada. Since World War II, thousands of firms, in addition to the motorvehicle manufacturers, probably could have been considered regular suppliers of original-equipment parts to the U.S. motor-vehicle industry. Of the transfer value of total original-equipment production in the Unit States in 1964, $6.6 billion, or nearly 44 percent of total production, was by independent vendors. 1/ Production of original-equipment parts for passenger automobiles, trucks and buses, in the United States prior to 1965 increased from $9.1 billion in 1960 to $15.1 billion in 1964 (an increase of 66 percent) and such production was completely dependent upon the requirements of the individual motor-vehicle manufacturers. Production of automotive parts in the United States was heavily concentrated in the Great Lakes States. By 1964, a number of the larger United States original-equipment parts producers had facilitie in Canada (e.g., Eaton, Borg-Warner, Stewart-Warner). 1/ See tables 81 and 91 of this report. Canadian production of original-equipment parts amounted to $234 million in 1960 and to $462 million in 1964 (an increase of 97.4 percent over 1960). Independent Canadian vendors accounted for $377 million or 81.6 percent of the total production in 1964. 1/ In that year approximately 154 Canadian plants were engaged in the manufacture of automotive parts and accessories; this number represents an increase of approximately 40 firms from 1960. Automotive parts production for this period was concentrated in the Province of Ontario. The independent parts producers located in Canada were highly dependent on orders from large motor-vehicle manufacturers. It should be noted that while overall demand for automotive products increased between 1960 and 1964, much of the increased Canadian parts production was likely a result of Canada's duty-remission plans, enacted in 1962 and expanded in 1963, which artificially stimulated both the production and exportation of such products. Sales of passenger auto Consumption of new passenger automobiles in the United States and Canada grew very rapidly following World War II, from 1.9 million vehicles in 1946 to 6.7 million vehicles in 1950. mobiles in the United States and Canada exceeded the 1950 level prior to 1960 only in 1955, when United States-Canadian sales amounted to 7.6 million vehicles. In 1960, such consumption amounted to 7 million units, but in 1963 it amounted to 8.1 million units, and in 1964 it amounted to 8.7 million units. 2/ Canadian consumption increased much more rapidly 1 See table 82 of this report. 2/ See table 1 of this report. |