I had the opportunity to hear David Cole, Chairman of the Center for Automotive Research, speak yesterday about the Michigan economy and its road to recovery.  Cole was cautiously optimistic that within the next couple years we would see the state's largest industry get back on its running legs.  In recent years, the US automakers have been crippled by the rising costs of pension benefits.  About $2,500 of every car made went to cover these benefits, a huge amount.  Now the unions are responsible for these benefits, allowing the US automakers to compete more effectively with foreign automakers.  Despite reduced labor costs abroad, shipping and import costs will make US automobiles a much better value than they were in the past.

The US automakers can now bring a product line to the market in two years where it used to take five.  This will allow quicker responses to demand and technological improvements.

Cole also spoke about the relative impact of the auto industry's troubles versus Pfizer's impact on the area economy.  He claimed that one auto production job loss results in the loss of ten more jobs.  In comparison, one job loss at Pfizer (which is primarily research and development) results in a single job loss.  I appreciated this informative perspective and was comforted that the pullout of Pfizer might not be as bad as many of us were anticipating.  And I'm hopeful that the US carmakers will be able to increase their share of the auto market.

Additionally, the development of hybrid engines and alternative fuels are moving in the right direction to help relieve the US's reliance on fossil fuels and imported oil.

In this challenging real estate market, I was heartened to hear a hopeful voice from a knowledgeable insider.  I welcome your comments and incite to help the community forecast its future and plan for the upcoming selling season.