Asian Carmakers Settle Into the South

Both of those factories are under expansion, and along with Hyundai have attracted dozens more companies that supply parts and services. "This is our salvation at this point, our new critical mass of employment," said Keivan Deravi, an Auburn University Montgomery economics professor.

The auto companies and suppliers account for up to 40,000 workers statewide, have invested billions of dollars and have caused the state to revamp its education and worker training programs, Deravi said. Rural Crenshaw County, for example, lost five textile mills in recent years to cheap foreign competition. Those jobs have been more than recouped, and at higher wages, by companies supplying the nearby Hyundai plant, said Doni Ingram, the county's economic development director.

The new jobs are no less welcome just because they're tied to an overseas employer, Ingram said. The community has embraced the Koreans, she said, with residents signing up to "sponsor" newly arrived Korean families, staging a cultural festival during the fall and welcoming the outsiders to churches and schools.

"All my Koreans call me 'mama,' " Ingram said. "They're very friendly, very family-oriented, very outdoor people. So they fit in the southern part of the United States very well."

As Americans take on more of the supervisory roles at the plant, she said, the Sonatas built there no longer seem like foreign cars. They're homegrown. "We should all be driving a Hyundai in Crenshaw County," she said.

Detroit automakers complain that they don't get the same acceptance and chance to compete in Korea, which is a tightly controlled market. But they also suffer from changing demographics within the United States, which increasingly work against plants located in the old industrial belt.

Factories like to be near their customer bases to cut down on distribution costs, and the South is a more attractive market than the Midwest, according to a 2003 study by the Center for Automotive Research in Ann Arbor. With population rising faster in the South and auto sales declining in the Midwest, "the demand to add more regional assembly plants -- and the jobs that go with them -- is likely to remain high in the south to the detriment of the traditional automobile states in the north," the study concluded.

It won't be easy for old-line automakers to take advantage of that trend. The cost of shutting down old factories and rebuilding in new places is prohibitive -- as demonstrated last week when GM closed its 70-year-old van plant in Baltimore. Under the UAW contract, GM could not lay off its 1,100 workers. It had to offer them a lump-sum buyout so they could retire or keep them on the payroll for two more years, whether they work or not.

Experts say Detroit's Big Three, counting the Chrysler Group, are going to have to rework their union contracts and eke out the right to cut jobs and benefits to remain competitive. For example, the three companies recently published a brochure touting their enormous contributions to the U.S. economy, noting that they still employ about 86 percent of all U.S. autoworkers. But the same brochure noted that those workers build 74 percent of the vehicles produced in this country each year -- suggesting, inadvertently, that foreign-owned companies produce more with fewer people.

"There's a lot of work for those guys to do," said Johnson, the Comerica economist. "The car companies are in a fiercely competitive environment, and they've got to become more efficient and assemble cars with less labor costs. It just has to happen."

Staff writer Warren Brown contributed to this report from Alabama.