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TOM WALSH: GM exec: Moving jobs to India is about vehicle development

March 12, 2004

BY TOM WALSH
FREE PRESS COLUMNIST

Jim Queen, General Motors Corp.'s vice president of engineering, walked over to a color-coded map of the world and pointed to a green oval shape with the word "India," connected by a straight line to the city of Bangalore, where GM opened a new engineering center last September.

"What this is NOT," Queen said, "is a wholesale shipment of engineering jobs to India."

I hadn't yet asked a question in our interview Thursday about offshore sourcing of engineering work to India and other nations with millions of low-wage workers, but Queen knew it was coming.

In this U.S. presidential election year, during a period of slow job growth, global corporations from IBM to General Electric to Microsoft to GM are taking heat for hiring workers in places like India, China and Mexico while reducing the head count at home.

Queen makes no apologies for cutbacks in Michigan that have enabled GM to prune engineering costs by 40 percent even as it increased the amount of work done by 33 percent since 1997. And he doesn't pretend that Indian engineers are paid as much as U.S. engineers. But to look merely at wage differentials is to miss the bigger picture of GM's global strategy.

What GM is doing in India, he said, is similar to what GM has done in Mexico and China over the past 10 years -- growing a design and engineering capability that will ultimately support an auto manufacturing presence in that country. GM's Bangalore facility will also work in tandem with GM engineering centers in Europe, South America, Korea and China.

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