Are health care costs hurting Detroit? Absolutely. Is it because the packages are too generous? Not exactly.

Ford spends approximately $3.5 billion per year on healthcare, while GM spends approximately $5.4 billion. In fact, Detroit automakers spend about $1,400 on health care per car, on average. That is more than they spend on steel.

But if America spent the same amount for healthcare that the rest of industrialized world does, every U.S. employer would be paying less than half of what it now does. Ford would save about $2 billion each year – and GM could save about $3.1 billion. In fact, more than 80% of Detroit’s 2007 North American losses would have been wiped out – if only America had a healthcare system that was as affordable for employers and workers as the rest of the industrialized world.

Automaker health care costs are from the companies (2005). Global health care costs based on OECD data (2005).

Automaker health care costs are from the companies (2005). Global health care costs based on OECD data (2005).

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